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Health Insurance Reform Gaining Momentum

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The health insurance industry has won the critical support of a private sector consensus committee as one of the “pillars” of healthcare delivery system reform.

The support came as momentum grew in Washington for passage of legislation providing a means for everyone to have some form of coverage–perhaps as early as this year.

The new report by the Health Reform Dialogue, a group designed to develop a consensus for reform, was issued in the same week as health insurance industry trade group officials reiterated before a Senate Committee their willingness to provide health coverage to all individuals, regardless of health status.

The industry is willing to do that, said Karen Ignagni, president of America’s Health Insurance Plans, if that is what is needed to secure legislation creating a comprehensive health reform plan that requires individuals to have coverage.

The members of the Dialogue include representatives of small business, unions, industry, and AHIP, the American Hospital Association, and the Blue Cross and Blue Shield Association.

It came as the House and Senate worked to complete the 2010 budget resolution, a blueprint for action on the budget for the coming fiscal year. Both houses of Congress were aiming to complete work on their resolutions before they left for a two-week Easter/Passover recess.

The Senate resolution currently does not include reconciliation instructions for healthcare reform, but Democrats were working at press-time to secure the votes for adding it.

And the House resolution does include reconciliation instructions for healthcare reform and education legislation.

If the final budget resolution contains such language, it would increase the likelihood Congress could pass such legislation this year, because such language enables those employing it to avoid Senate filibusters, according to industry lobbyists and congressional staffers.

Specifically, the Dialogue report says healthcare reform programs should be based on the “pillars” of the current system, employer-sponsored insurance and public safety-net programs for low-income people and families.

The report was prepared in an effort to narrow options and hasten consensus on legislation designed to provide health insurance to the 46 million people uninsured in the United States, “more than the combined population of 24 states,” the report said.

Among the provisions Congress should incorporate in a universal health system, the group said, was to give individuals eligible for Medicaid and the Children’s Health Insurance Program the option to utilize those dollars to purchase employer-sponsored insurance.

This should be allowed, the report said, “so long as full Medicaid or CHIP wrap-around coverage is available.”

Any new plan, the report added, should also provide advanceable, refundable tax credits or other subsidies on a sliding scale for individuals and families to purchase adequate and affordable coverage, which includes effective preventive services.

As for the industry, Ignagni outlined its position on reform in testimony at a Senate Health, Education, Labor and Pensions Committee hearing. Officials of the Blues made the same commitment.

The plan, also presented at a Senate Finance Committee hearing in November 2008, calls for investments in health information technology, preventive care and efforts to realign the incentives that now encourage doctors and hospitals to provide more care than necessary.

AHIP member companies are open to providing coverage on a guaranteed-issue basis–if the government prevents anti-selection by creating an enforceable requirement that individual consumers have health coverage, Ignagni said.

Consultants at Milliman Inc., Seattle, found that “states that enacted guarantee-issue laws in the absence of an individual coverage requirement saw a rise in insurance premiums, a reduction of individual insurance enrollment, and no significant decrease in the number of uninsured,” Ignagni said.

Representing health insurance agents, Janet Trautwein, chief executive of the National Association of Health Underwriters, suggested that the government requires guaranteed access to individual coverage in exchange for state-level organizations protecting insurers against catastrophic risks.

Health insurance market reform also should include efforts to standardize state pre-existing condition rules; improve federal group-to-individual coverage portability provisions; limit insurers’ ability to rescind existing policies; make it easier for employers to help workers buy individual health insurance; and provide new subsidies and deductions to help make individual health coverage affordable, Trautwein said.


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