Albany and Health Care Providers Ponder Federal Reforms

Thursday, April 28, 2011

The State Senate held a panel discussion with major health care stakeholders, on how New York will implement the federal health care reforms proposed by President Obama and passed by Congress.

The federal health care reform act requires states to set up health care exchanges to give the uninsured access to the health care that they will be required to buy when the new law takes effect in 2014.

Senate Health Committee Chair Kemp Hannon says the exchanges will provide information about “who the insurers are and what the plans are.”

“You have to be setting up, in essence, a new enterprise to provide one million New Yorkers with health insurance,” said Hannon, who said the federal government will also require varying levels of plans.

Senator Hannon, along with Senate Insurance Committee Chair Jim Seward, sponsored a forum, which brought together representatives from leading health insurance companies, as well as business and consumer advocates to begin to figure out how to implement the changes.

Some on the panel advocate creating a new public authority to implement the health care exchanges for the nearly one million uninsured New Yorkers. The other choices include using an existing state agency to run the exchanges, or set up a private not for profit entity. Advocates of the public authority model say state agencies are too bureaucratic, and might be slow to react, while a private entity might not be accountable to the public. Jim Tallon, is with United Hospital Fund, a health services research and philanthropic center, and a respected voice in New York’s health care policy circles. He says a public authority could be a viable compromise.

“This has kind of been the consensus way of bridging left and right,” said Tallon. “Bridging government and markets in this discussion.”

Tallon says recent public authority reforms passed by the legislature could also help guarantee that a new authority would be accountable to the public.

State lawmakers will also have to decide whether all of the state’s around one million uninsured will be in a single pool of policy holders, or whether the individual market will be split off from the small business market. The vast majority of people who work for larger corporations and the public sector obtain health insurance through their employer and would not immediately be affected by the exchanges.

Mark Scherzer, with New Yorkers for Accessible Health Coverage, and the health care consumer advocate on the panel, says both groups need to be in one pool. Otherwise, he says, those in the individual policy market, who often suffer from chronic diseases and can’t work, will have to pay for a disproportionate share of their care.

“You’ve shifted the cost of being sick to the sick people,” said Scherzer. “Which kind of defeats the purpose of insurance.”

Ken Pokalsky, with the State Business Council, says small business also “struggle” with out- of- control insurance premium costs, and will need guarantees that they won’t be priced out of the exchanges.

He says his members list the high cost of health care as their “number one concern” in doing business in New York.

New York State requires more procedures and treatments be covered by health insurance than most other states.

Senate Insurance Committee Chair Jim Seward says it’s important that lawmakers not delay, and at least get the structure of the exchanges approved during this year’s legislative session, and then fill in the details later.

“We need to get going, at least on the basic structure,” said Seward.

It’s possible that the federal courts could throw out the requirement that each American must purchase a health care plan, the US Supreme Court won’t be considering the case until sometime in 2012, but Senate Health Committee Chair Hannon says that won’t mean that setting up the exchange will be a waste of time. Hannon, a Republican, says the exchanges, after all, were originally an idea that came from conservatives. And he says they could help promote New York’s own plan for the uninsured, Healthy New York, which offers coverage, with some restrictions.

While some are welcoming the federal health law changes as a way to restructure the state’s health care system for the uninsured, Senator Hannon says he believes it’s also important to be cautious, and follow the old medical adage first, “don’t do any harm”.


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Comments [4]

Howard from NYC

Well Mike, I agree with your last sentence: "...we have a problem." (sorry if I have taken this a bit out of context). Relying on people to take things seriously and manage... will never work. The ACA has not solved the age-old riddle of motivation.

We are at best ten years away from implementing IT goals (I know many people who work in hospitals, and they sometimes must literally walk across the street to pick up reports because different departments are not linked; though some facilities are certainly better equipped than others). Prevention is nothing new. There is very little that will happen to create a major impact there in terms of motivating the general population (having driven around the country twice, I have found that it is impossible to buy skim milk in certain states). McDonalds is looking to hire 50,000 new workers. The Boomer generation is getting older by the second, and living longer. Most disease management programs only work on paper, or it's too difficult to provide valid studies on them (based on follow-up, failure to consider unique aspects of different patients, etc.). People will continue to use the ER for paper cuts and disregard follow-up care. And many, many doctors are arrogant and uncaring.

But the kind of "scratching" of which I speak is, for example, needlessly keeping people in the hospital over the weekend because of bureaucratic stupidity (or laziness on the part of attending physicians- at several thousand dollars a pop), providing highly sugary foods and beverages to my diabetic father, and much worse offenses that are never reported or investigated. Further, the theory of lowering cost by compelling the entire population to buy coverage is nice, as a theory. But even if the theory is correct (and I have some degree of respect for it from an underwriting perspective) the benefit will only be realized if everyone participates in the same plan (or from one - three very large plans). By giving-in to the insurance lobby, the exchanges will likely offer high level plans that will be purchased by sick people, and poor / healthy young people will take stripped-down plans that can expose them to medical bankruptcy (even today, there are people who are medically bankrupt despite having health insurance). Our health care dilemma goes far beyond the insurance industry. Even if insurance premiums were cut down by 1/3, there are many who would still struggle to pay for it. The ACA is a disorganized mess which has a smattering of interesting ideas, but mostly conflicting, lobbyist-dictated provisions. It is a monstrosity. Eventually, health care will be nationalized. Not because of lobby-dictated legislation, but out of sheer necessity.

Apr. 30 2011 04:10 PM
Mike from LI from Long Island

In response to Howard from NYC who writes

The ACA does not even scratch at the enormity of deficiencies in our health care delivery system.

I can only say that I think we are reading a different ACA law. Accountable Care Organizations, patient centered medical homes, sought improvements to IT, the many grants to prevention and public health, the workforce enhancements to primary care services all make improvement to the deficiencies of our current delivery system. Of course, if we don't take these things seriously and manage them they way they should be managed, then, yes, we have a problem.

Apr. 30 2011 01:58 PM
Jeremy Engdahl-Johnson from New York, NY

Three healthcare reform papers: Key considerations for state health exchanges--structure, terms of participation, plan design.

Apr. 29 2011 12:36 PM
Howard from NYC

Some years ago, a former mentor of mine worked diligently at establishing an exchange-style insurance forum with the goal of providing information and guidance for independent contractors in the arts. But like the rest of the market, the association and other individual insurance products that were showcased fell victim to out-of-control medical inflation (as opposed to "out-of-control insurance premiums"). The ACA does not even scratch at the enormity of deficiencies in our health care delivery system. By 2014, insurance exchanges will merely look like a showcase of "Cadillac plans."

Apr. 28 2011 08:40 PM

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