Health Care Reform Effort Gearing Up

The drive to draft and enact comprehensive health care reform legislation is on track, the chairman of the Senate Finance Committee said.

“We are on schedule,” Sen. Max Baucus, D-Montana, said last week, adding that his committee will begin consideration of a reform bill in mid-June.

“The serious stuff” is about to begin, added Sen. Charles Grassley, R-Iowa, the committee’s ranking Republican member.

As the committee prepares to draft legislative language, Sen. Baucus noted that final decisions on a wide array of issues remain to be decided.

“So, everything’s on the table: all the concepts, all the ideas,” he said.

“I’m telling everybody to suspend judgment, even if for a nanosecond. If there’s something you don’t like, just suspend judgment. Just cool it. Just keep your powder dry,” Sen. Baucus said.

While final decisions have yet to be made, Sen. Baucus has hinted at the shape of some of the provisions.

As of now, he is supportive of the approach Massachusetts took in its 2006 reform law in which the low-income uninsured can get coverage from private health insurers offering policies through an exchange that is administered by a state agency.

“That’s basically what we are thinking about in our plan,” he said.

“We’ll set up a system similar to Massachusetts where an individual looking for health insurance can go to the exchange and get health insurance from a health insurance company who is offering insurance on that exchange,” similar to the way federal employees can shop for coverage, he said.

The panel chairman said he has no intention of interfering with the way self-funded employers provide coverage to employees.

“The system I envision is one where self-insured companies … can keep their own plans and manage health insurance in the way they have. We’re not going to change the way self-insured companies handle health care for their employees,” he said.

That approach is very different from the one the Clinton administration tried to pursue in 1993 when it called for dismantling the employment-based system in favor of coverage through public purchasing cooperatives. Congress rejected that approach.

The hints that Sen. Baucus has dropped are comforting, benefit lobbyists say.

Sen. Baucus and other key leaders in Congress “realize the vast majority of people are satisfied with the coverage they receive from their employers. There is no point taking away from people with what they are content,” said James Klein, president of the American Benefits Council in Washington.

“At this point, we are encouraged,” added Michael Ferguson, COO of the Self-Insurance Institute of America Inc. in Simpsonville, South Carolina. Ferguson said the SIIA has spent a lot of time educating members of Congress and staff on the role self-funded employers play in providing coverage.

Aside from wanting to keep employers and insurers as purchasers and providers of coverage, respectively, the reform approach being taken by Sen. Baucus differs in other major ways from the Clinton strategy.

It is clear, for example, that this time around Congress is taking the lead, with input from the Obama administration in drafting legislation. By contrast, the Clinton administration shut out Congress, with the result that members felt no ownership with the Clinton plan and quickly spurned it.

“This is the way most legislation is drafted. The president gives an outline and leaves it to Congress to develop the specifics,” said Klein, referring to the reform drive.

“Many of the players involved in 1993 and 1994 are around today and have learned from the mistakes that were made then,” said Frank McArdle, a consultant with Hewitt Associates in Washington.

Still, as McArdle notes, there are plenty of political minefields ahead. Reform leaders face tough and sensitive decisions on such issues as whether employers should be mandated to offer coverage, whether individuals must be enrolled in a health care plan, and how to pay for an expansion of coverage.

“The critical and most controversial issues soon will be coming to fore,” Klein said.

Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.