State Children’s
Health Insurance Program Reauthorization
Funding for the federal State Children’s Health Insurance Program (SCHIP) will be reauthorized during 2007 and, during this process, there is the opportunity to make structural changes to the program. NAHU opposes an expansion of SCHIP to cover parents or other adults as this was not the intent of the legislation and could exacerbate the crowd-out problems that already plague this program in many states. Furthermore, we oppose changing the financial structure of this program from a block grant to the individual states to a new federal entitlement program. The block-grant structure has allowed beneficial state program innovations that include cost-saving partnerships with the private insurance market, and that ability would be lost if the program became a federal entitlement. NAHU feels that it is very important that SCHIP retains its ability to partner with the private insurance market. It’s our goal to make it even easier for private-market integration by removing some current restrictions that have hindered premium subsidy efforts of private-market employer-sponsored coverage. Many parents of SCHIP-eligible children have access to employer-sponsored health insurance coverage but cannot afford their portion of the dependent premiums. NAHU would like to see the process for states to use SCHIP dollars to subsidize such employer-sponsored coverage made much simpler so that more families can be covered together.
Health Information Technology
and Other Means of Reducing Costs and Improving Quality
NAHU knows how much the cost of health insurance coverage is
impacting our nation’s employers and economic growth, and we also know that
health insurance is expensive because of the high cost of health care. It is estimated that improvements to health
information technology can reduce health care costs up to 20 percent each year
by saving time and reducing duplication. As such, we are highly supportive of
health IT initiatives, and feel that they will help reduce health care expenses
and lead to higher-quality care for American consumers by reducing errors and
improving patient satisfaction. Health IT
advances will enable true collaboration between doctors and patients as
consumers make more informed choices and doctors become more involved in their
care. In the long run, improved
technology will also provide better information to track public health problems
and advance clinical research.
In particular, NAHU is supportive of efforts to make all
health records electronic with interoperable technology, so that all record
systems are able to communicate with one another and individual health records
are always up-to-date and complete, and we feel that federal legislation would
go a long way towards achieving that goal.
Interoperable electronic health record systems would reduce medical
errors by providing complete patient histories, computerized ordering and providing
electronic reminders. Furthermore,
patient histories could be easily updated with new information and have
internal checks for things such as negative drug interactions, which may not be
systematically checked by the physician.
Another benefit of electronic health records is that they would protect patient privacy by only allowing authorized individuals to access protected health information. NAHU feels that current federal protections of health information under the HIPAA privacy regulations do a good job of protecting patients and are not overly burdensome on providers or insurers. As such, we would oppose any attempt to change these protections to allow for private rights of action.
Transparency of medical costs is another cost-reduction issue that is critical for NAHU. We believe that the advent of a more consumer-directed approach to health insurance coverage is essential to reducing overall health care costs as it will help curb excessive utilization and claims, and drive down costs by increasing competition among providers. However, to be fully successful, American consumers need to be fully aware of the cost of the health care that they are purchasing. Since the vast majority of American health care expenses are paid by a third party through the administration health insurance claims, most Americans have no idea what the health care that they receive costs, and they have been conditioned not to even ask. As a result, the ability for consumers to compare costs and quality when making decisions as to which providers to use and which health care services to select has been virtually eliminated.
NAHU strongly encourages health insurance carriers, hospitals, physicians and other health care providers to voluntarily disclose the prices they pay and charge for care to all consumers. However, since we believe increased medical transparency for health insurance consumers is so critical to reducing costs and promoting consumer-directed care, we support legislative and regulatory efforts at the state and federal levels to require increased transparency should voluntary efforts fail, provided that such governmental efforts are not overly burdensome.
Medicare and
Prescription Drug Costs
NAHU opposes changes to the Medicare Part D program to allow for direct government negotiation of prescription drug prices. NAHU opposes direct government negotiations in Part D. The Congressional Budget Office, a non-partisan government body, has asserted that direct government negotiation will not save money. Some people have suggested that if there is no fiscal harm in government negotiation, then Medicare should be allowed to negotiate. NAHU has great concerns about the possible threat to private coverage, which is working well to insure millions of seniors at substantially less cost than was originally anticipated.
NAHU also encourages Congress to come to a reasonable compromise establishing a long-term fix to the fair reimbursement issue concerning Medicare providers. Any legislation must balance costs incurred for the care of Medicare beneficiaries and account for the impact of any increase in payments on Part B premiums and the taxpayer.
Reimporting prescription drugs from
Long-Term Care
NAHU has long sought legislation to include long-term care insurance premiums in Section 125 plans to encourage group LTCI sales. Group LTCI premiums are between 20 and 30 percent less in the group market and these products are also fully portable. Plus, buying private coverage guarantees consumers the greatest possible degree of choice when it comes to their long-term care needs. Finally, if more individuals were able to privately finance their LTC needs, the cost savings to both the federal government and the states in reduced Medicaid expenditures would be enormous, as Medicaid is currently the primary payer of American long-term care costs.
Patients’ Bill of
Rights
Patients’ Bill of Rights legislation, which includes means for individuals to sue their health plans or the employers that provide such plans as a means of dispute resolution, has resurfaced as an issue in the 110th Congress. NAHU is committed to protecting patients without increasing the price of their health insurance. Patient rights legislation that exposes health plans and/or employers to liability will be extremely costly and force more employers to reduce benefits, increase employee contributions, or possibly discontinue providing health benefits altogether. And it is just not necessary. The individual states are already doing a great job of protecting health insurance consumers and requiring that insurers meet the terms of their health plan contracts through such mechanisms as binding external review, providing direct access to OB/GYNs and pediatricians, prohibition of gag clauses, and prudent layperson emergency care standards. Patients are entitled to proper and necessary care that falls within the guidelines of their health insurance contracts. Implementing additional restrictions and providing an opportunity to expand employer and health plan liability will only further contribute to rising health care costs and thereby increase the number of uninsured.
NATIONAL ASSOCIATION OF
HEALTH UNDERWRITERS (703) 276-0220 ¨(703) 841-7797 FAX ¨ www.nahu.org