Health Insurance Reform Weekly : EasyToInsureME : July 16th 2009

On
the health care reform front, the Senate HELP Committee continues to
slug it out amendment by amendment, with Democrats winning all of
the important ones on straight party-line votes. The HELP
Committee started the week by unveiling its new language on the
public plan and the employer mandate, but it still has no language
on biogenerics. The committee hopes to complete this work by week's
end. The Finance Committee has yet to meet to mark up a bill
because it doesn't have a bill as yet - the Chairman is
still seeking a bipartisan compromise with Republicans. The
long-awaited beginning of the Finance Committee mark-up will have to
wait until the following week at the earliest. The House-planned
introduction of its bill was postponed until early this week, which
puts off the beginning of the House mark-up until later in the week.
It seems clear that the Democratic leadership is seeking to convey
the impression that progress is being achieved, while having to deal
with constant rumblings that the bills simply cost too much for even
Democrats to accept. While the House surely has the capacity to meet
its goal of having a bill ready for floor debate by mid-July, it is
unlikely that Speaker Pelosi will allow this without an expectation
that the Senate also will debate a bill before the August recess,
set for August 7 in the Senate.

States

ARIZONA Health Insurance : In the wake of the failed 2008 ballot "Medical
Choices Act" initiative, the legislature passed a resolution
proposing to amend the Arizona Constitution to state that "no law or
rule shall compel a person, employer, or health care provider to
participate in any health care system, including a prohibition of
penalties or fines for direct payment of lawful health care
services." The amendment would also state that "the
purchase or sale of health insurance in private health care systems
shall not be prohibited by law." The resolution was certified for
the 2010 general election. Additionally, the legislature passed and
sent to the Governor a proposal to limit the benefit mandates that
apply to the individual market; the proposal awaits the Governor's
signature.

CONNECTICUT Health Insurance : As anticipated, Gov. M. Jodi Rell vetoed
two of the most significant and flawed pieces of legislation
approved this year by the legislature. The first, the Connecticut
HealthCare Partnership bill, would have opened the very
expensive state employee health plan to small businesses and other
groups on an unregulated, self-insured and financially risky basis.
The second would have set in motion a fully state-run health care
system in Connecticut by implementing the "SustiNet
Plan." Either measure would be very costly to taxpayers,
especially with the state facing a projected $8.85 billion budget
deficit over the next two years. The legislature may attempt to
override these vetoes in a "veto session" scheduled for July 20. A
veto override requires 101 votes in the House and 24 votes in the
Senate - all 24 Senate Democrats would need to be present on a
summer day to enact the override. The Democrats have only overridden
one of Rell's vetoes during the past five years. The insurance
industry has advocated for an alternate concept for expanding health
coverage. That plan also would create an insurance pool, but the
plan would permit insurers to offer coverage rather than forcing
people to use a public pool.

Governor Rell has also issued an Executive Order
creating a 15-member Connecticut Health Care Reform Advisory Board
to develop a set of health care policies in response to federal
reform initiatives. These proposals are directed at
emphasizing cost containment, maximizing federal matching funds,
enhancing access to preventative care, and assuring coverage for all
children. The board is required to make interim recommendations by
Feb. 1, 2010 and submit final recommendations to the Governor and
General Assembly by January 1, 2011.

MASSACHUSETTS Health Insurance : Harvard Pilgrim Health Care President
Charlie Baker announced that he is pursuing the 2010 GOP nomination
for Governor of Massachusetts, and will be leaving his job at
Harvard Pilgrim Health Care. Baker is seeking to unseat
incumbent Democratic Gov. Deval Patrick. Patrick was elected the
state's first African American governor in November 2006, ending a
16-year run of Republican control over the Executive Office. State
Treasurer Timothy Cahill may also be in the mix as he announced he
is leaving the Democratic Party and weighing an independent
candidacy for governor. Cahill has been espousing a fiscal
conservatism usually voiced by Republicans. Bruce Bullen, Harvard
Pilgrim's current chief operating officer, will become interim chief
executive officer.

NEW YORK Health Insurance : After more dramatic developments late last
week, the deadlock in the Senate was finally broken and the Senate
immediately began passing bills. More than 100 were moved through
the process in one night. As expected, the Senate voted to
make the state's mental-health parity law (Timothy's Law) permanent.
They did not take up any other health industry issues. The way
toward legislative action was paved when breakaway Democrat Senator
Pedro Espada announced he would rejoin the Democrats, giving them
the needed 32-30 majority over Senate Republicans. Sen. Espada will
be the Senate Majority Leader, and Senator Malcolm Smith will serve
as the Senate President. The scope of their authority in those roles
is undefined at this time, as ordinarily those titles are held by
the same Senator. The Senate plans to be back in session on
Wednesday, July 15, to address several local municipality bills. The
complete calendar of bills has yet to be made public.

NORTH CAROLINA Health Insurance : Key legislators have heard from
numerous interested parties regarding the proposal to increase
premium taxes across all lines of insurance from 1.9 percent to 2.25
percent, effective January 1, 2011. Because of the strong
opposition to the tax, alternatives measures continue to be
discussed. Aetna is working with all interested parties to defeat
the new taxes.

Ohio Health Insurance : The state's budget woes continue as the
deadline for the interim budget expired on July 7. Governor
Ted Strickland signed a second seven-day extension through July 14,
giving the legislature additional time to craft a bipartisan plan.
But, with the ongoing stalemate between the Governor and the Senate
over video lottery terminals, the conference committee has been
unable to engage in any substantive discussion regarding the
deficit. Instead, Senate President Harris forwarded a letter and a
joint resolution to the Governor calling for a ballot vote in
November. It is unclear what the next step will be. Health industry
issues, including open enrollment program changes, electronic claims
payment, a dependent age increase and administrative expense
reporting, remain in limbo.