Guest commentary: Health care on the move, but not where it should be

Bills are likely to be brought before the House and Senate for voting on virtually the same day in early November, weeks later than Senate Majority Leader Harry Reid wished, but possibly in time to give the president the signing celebration he hopes to hold by mid-December.

America’s Health Future Act as approved by the Senate Finance Committee, the Affordable Health Choices Act as approved by the Senate HELP Committee and the House Tri-Committee bill are all being readied for votes by the Senate and House of Representatives, respectively.

These acts/bills are not, in my view, health-care reform but essentially insurance reform.

There is virtually no attention to the massive health-care delivery system where adoption of advances and efficiencies from some of the best hospitals could be encouraged around the country.

There is no reference to medical doctors, who finish school with huge debts and an equally huge incentive to put earnings before care.

There is no attempt to rein in medical liability through tort reform so that protective medicine will continue unabated, draining as much as 8 to 10 percent of total health costs for questionable diagnoses and therapies, some of which create false positives and even greater costs and angst for patients distraught with the fear of complications they do not really have.

The acts do provide for “comparative effectiveness research” funded by adding federal premium taxes on employer-sponsored health plans (hardly an incentive for employers to keep funding their health plans). While the study is well-intended and may produce useful results, these will not be determined and utilized for years.

What the acts/bills include in a nutshell (I use “might” a lot as all these are still being debated):

n Employees might not be allowed to opt out of their employer’s health plan subject to a penalty of tax of $750 to $1,000 per year. This has both tax-deductibility and possibly accounting implications.

n A similar penalty for individuals who do not buy health insurance also is still being considered. (I’m not sure how you tax or penalize people who do not buy coverage because they do not have the money to pay for it)

n A “public plan” or “insurance exchange” or “co-op” is likely to pass with requirements set out by government but run by the private sector at negotiated rates. States could be required to establish such insurance exchanges by 2013. A “public option” government-operated plan is considered unlikely, but it is still in the Senate HELP bill and the Tri-Committee House bill and House Speaker Nancy Pelosi has not given up on this. She continues to push for it as a stepping stone to a single-payer government plan.

n Insurers are likely to be required to offer coverage to everyone with no pre-existing condition exclusion but provisions will be included to minimize people buying coverage only after they find they have a problem (sometimes called the “burning house provision” as in “you cannot buy coverage after the fire has started”).

n Sen. John Kerry, D-Mass., continues to press for a mandate that all employers provide coverage to all employees as is done in Massachusetts.

n There is some talk of considering premiums that are paid for the recent drug plan being treated as taxable income.

n Some on Capitol Hill would like to increase the age of “dependents” under health plans to broaden the base of those with coverage.

n The so-called “doughnut hole” in Medicare Part B that leaves a gap in reimbursed drug costs is likely to get some attention but we are not sure what.

n An excise tax on premiums above $8,000 for individuals and $22,000 per family for so-called “luxury health plans” still is being considered.

n Employers have expressed concern that the Employee Retirement Income Security Act (ERISA) provision that makes it possible for national employers to provide uniform benefits to their employees across the country does not get weakened.

n An encouraging note regarding “wellness” is that employers might be able to offer rebates or modify co-pays and deductibles with a value of up to 30 percent of plan costs to encourage good health behaviors.

There is considerably more in the details of the acts/bills, but this provides an indication of where the emphasis is. A large and growing number of side-by-side analyses of these are available through Google.

I believe we have had a unique opportunity to launch a serious, multiyear study of how to create the best, sustainable health-care delivery system in the world focused on how best to provide safe, efficacious health care in the most economical manner, an effort that goes well beyond the “comparative effectiveness research” referred to above.

But this is not to be. They have labored like the ox and come forth with a peanut.

Beadle is a past chair of the American Benefits Council, the U.S. Chamber of Commerce Health Committee and several health and legislative organizations. He was a director of Mercer Inc., the world’s largest consulting actuarial company, for 25 years, including heading its New York and Eastern Canada regions. E-mail him at bwelltoday@aol.com