Crain's Detroit News Story: Sen. George introduces health insurance bills to help cover uninsured
Sen. Tom George, R-Kalamazoo, chairman of the Michigan Senate Health Policy Committee, today introduced a package of four bills – called MI-Health – aimed at providing low-cost, subsidized health insurance to people who earn less than $30,000 and families that earn less than $60,000.
From Crane's Detroit Business, 5/14/09
Sen. Tom George, R-Kalamazoo, chairman of the Michigan Senate Health Policy Committee, today introduced a package of four bills – called MI-Health – aimed at providing low-cost, subsidized health insurance to people who earn less than $30,000 and families that earn less than $60,000.
“We want to improve access to health insurance for the 1.2 million people uninsured in Michigan and create subsidies to get the premiums down to $50 or $60,” said George, a practicing anesthesiologist.
George, who co-sponsored the bills with a bi-partisan group of senators, said he will hold the first hearing on MI-Health in Lansing on May 20.
“The Senate Republican MI-Health plan is about helping provide affordable, accessible health care to hundreds of thousands of Michigan residents,” said Senate Majority Leader Michael Bishop in a statement.
“We will continue to seek the input and work together with experts in the health care field — the insurance carriers, the hospitals, physicians, Blue Cross Blue Shield of Michigan, and Michigan business owners and job providers to develop the best plan,” Bishop said.
The bills —listed as Senate Bills 579, 580, 581 and 582 — provide a number of consumer protections that include mandating 6 month pre-existing condition waiting periods. It also would prohibit insurers from raising rates at renewal when a person becomes ill.
A key provision of SB 580 calls for the formation of a reinsurance fund that will reimburse carriers for claims above $25,000. The bill would create a Michigan Claims Board, formed within the state Office of Financial and Insurance Regulation. The board would determine the amount of assessments all health insurers and third-party administrators would be required to pay.
“This is in recognition of Blue Cross’ situation where their burden as insurer of last resort is becoming greater,” George said. “This helps Blue Cross because they have older and sicker patients.”
For claims greater than $25,000, carriers would submit bills to OFIR and recoup 90 percent of their claims between $25,000 and $250,000, George said.
“They have to pay 10 percent of the costs over $25,000 so they have some incentives to hold down costs,” George said.
Blue Cross officials blame the company’s $133 million in losses last year in the individual market to competing insurers that reject applicants who are sicker and more costly and send them to Blue Cross.
“My legislation prevents carriers from dropping you when you get sick,” George said. “This has been one of Blue Cross’ complaints.”
The bills also feature two basic benefit insurance programs that would expand coverage for the uninsured.
The first, MI Access, would cover uninsured patients earning less than 200 percent of the federal poverty level. MI Coverage would cover those earning between 200 and 300 percent of the federal poverty level.
George said the bill also would create a Cover Michigan Board that will determine the benefit package of the insurance products.
“Every insurer will be able to offer these policies, so we will create competition in the market,” George said. “They will have modest benefits, probably less than traditional insurance.”
George said the key is to make it affordable so people have access to basic physician, hospital, wellness and pharmacy coverage.
“We may want to waive the existing mandates to make affordable benefits,” he said.
While details need to be worked out in committee, George said there will be three funding sources for the subsidized basic benefit packages.
“Blue Cross will be expected to pay an assessment, a PILT (payment in lieu of taxes) because they will benefit from this program,” George said.
The original article can be found here.
Posted: 5/14/2009