Health Care Reform Update from Easy To Insure ME

May 12, 2010

Read this week about what is happening on the federal legislative front of Health Care Reform.

House Hearing on Health Care Pricing Transparency Proposals
The
House Energy and Commerce Subcommittee on Health held a hearing on May
6, 2010 regarding legislative proposals aimed at improving transparency
for health insurance
consumers. Three separate transparency bills were listed on the hearing
agenda, although the discussion among subcommittee members and
witnesses focused broadly on the merits of transparency and the
possibility of unintended consequences.

Representative Steve
Kagen (D-WI) testified in support of the H.R. 4700 bill he has
introduced, which would require health care providers and insurers to
publicly disclose, on a continuous basis, all prices for health
care-related items, products, services and procedures. Kagen said that
this bill would “establish a very competitive medical marketplace” and
allow families to “make their health care decisions based upon quality,
and the price and the service of available caregivers.”

Michael
Cowie, an antitrust attorney with Howrey LLP and a former official with
the Federal Trade Commission (FTC), expressed concern that the Kagen
bill would conflict with existing antitrust provisions that are
intended to prevent collusion that could contribute to higher costs.
Cowie also cited economic studies showing that mandatory publication of
pricing terms often leads to higher pricing.

Steven Summer, a
Colorado Hospital Association representative, suggested a four-prong
approach to improving transparency: expanding existing transparency
efforts through collaborations between states and state hospital
associations; requiring insurers to make estimated out-of-pocket costs
available on a pre-care basis; conducting more research on the pricing
information that consumers want and need; and making pricing
information consumer-friendly.

The other transparency bills discussed at the hearing were:

* H.R. 2249, introduced by Representative Michael Burgess (R-TX), would
require states, as a condition of participating in Medicaid, to
establish laws for the disclosure of information on hospital charges,
to make such information available to the public, and to provide
individuals with information about estimated out-of-pocket costs for
health care services.
* H.R. 4803, introduced by Representative Joe
Barton (R-TX), would require health insurance plans to make available
to enrollees and potential enrollees specified information, including
covered items and services, a list of limitations and restrictions, the
number of participating providers according to specialty type,
information on cost-sharing, a description of the claims appeal
process, and other information.

Although both Democrats and
Republicans voiced support for stronger measures to improve
transparency, it is not clear at this time whether the subcommittee
will be marking up any of the legislative proposals discussed at the
hearing.

House Republicans Urge Democrats to Hold Hearings on Health Care Reform Law
Republican
Members of the House Energy and Commerce Health Subcommittee repeatedly
urged Energy and Commerce Committee Chairman Henry Waxman (D-CA) to
hold a series of hearings on the new health insurance reform law during
the recent Subcommittee hearing on health care pricing transparency
(see above information). Chairman Waxman gave no indication that he
intends to hold hearings on the reform legislation.

Republicans
have specifically requested to hear the testimony of Centers for
Medicare and Medicaid Services Chief Actuary Rick Foster regarding a
report his office prepared on the impacts of the health insurance
reform legislation. The report estimates that the law will increase
health care costs by approximately 1 percent over the next ten years,
and will cause approximately 14 million Americans to lose their current
employer-sponsored coverage.

In an April 28 letter to Chairman
Waxman, Ranking Member Joe Barton (R-TX) wrote, “We believe that
inviting Mr. Foster’s testimony is invaluable to our efforts to rein in
health care costs and government spending. We therefore ask that you
invite him to testify as soon as possible.”

Senator Feinstein Continues Seeking Support for Federal Review of Insurance Rates
Senator
Dianne Feinstein (D-CA) continues to seek support for legislation she
has introduced, which would give the federal government the authority
to review and block health insurance rate increases.

The Health
Insurance Rate Authority Act of 2010 (S. 3078) would authorize the HHS
Secretary to conduct health insurance rate reviews in states where the
state insurance commissioner does not have the authority or capability
to do so. The legislation would also give the HHS Secretary the
authority to block “unreasonable” rate increases. The bill currently
has six cosponsors.

On April 28, Senate Health, Education,
Labor, and Pensions Committee Chairman Tom Harkin (D-IA) held a hearing
on the legislation in which he stated that “it’s my intention to move
toward a markup or at least do something to get the bill moving” this
year. Also, Senator Feinstein has indicated that she may seek to move
the legislation by offering it as an amendment to an unrelated bill.

Representative
Jan Schakowsky (D-IL) has introduced companion legislation (H.R. 4757)
in the House, which currently has 27 cosponsors.

Possible McCarran-Ferguson Amendment
Senator
Patrick Leahy (D-VT), chairman of the Senate Judiciary Committee, filed
an amendment on May 6 that proposes to repeal portions of the
McCarran-Ferguson Act as they apply to health insurance plans. Chairman
Leahy filed this amendment with respect to the financial regulatory
reform bill currently being debated on the Senate floor. Senate leaders
are hoping to complete action on this bill by May 14.

The Leahy
amendment is based on legislation, Health Insurance Industry Fair
Competition Act (H.R. 4626), that the House approved in February. The
health insurance industry has repeatedly stated that the
McCarran-Ferguson Act is extremely limited in scope and has nothing to
do with competition in the health insurance industry, which is the
issue the House bill purports to address. However, opponents of repeal
say this move could have unintended consequences and could disrupt
initiatives to enhance efficiency, reduce costs and improve the quality
and safety of patient care. Currently, the federal government intensely
examines, and takes action on every merger involving health insurance
plans. Also, all insurers are subject to state antitrust laws, as well
as state rate regulation and other state laws enforced by State
Attorneys General and insurance regulators.

Karen Ignagni,
president of America’s Health Insurance Plans (AHIP), said that such
legislation “attempts to remedy a problem that does not exist” and that
repeal efforts are “based on a misperception of the scope and impact”
of the exemption.

As of this writing, Chairman Leahy has not yet
offered the amendment for consideration. Among the approximately 130
amendments that have been filed for the financial regulatory reform
bill, only a small portion will likely be considered by the Senate. As
noted above, Senator Dianne Feinstein (D-CA) has not yet filed an
amendment for a federal rate review process.

New HELP Committee Staff
Jenelle
Krishnamoorthy has been named health policy director for the Senate
Health, Education, Labor and Pensions (HELP) Committee. Krishnamoorthy
served as the lead health staff member for HELP Chairman Tom Harkin
(D-IA). She succeeds David Bowen, who worked for the HELP Committee for
10 years.

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