On Tuesday, the House Insurance Committee will hear the bill establishing a new health insurance market in North Carolina that includes no consumer protections. The last time this bill was in committee legislators heard from the public. The testimony was unanimously against the bill.
As a reminder, here are just a few reasons this legislation does not deserve support:
• The funding is both damaging and insufficient. Money from the High Risk Insurance Pool is not enough to cover the cost of the exchange. To fund the extra expense 115 levies a new health care tax on individuals and small businesses. This will increase costs and discourage healthy people from buying coverage in the exchange.
• The exchange is allowed to “collect and use advertising fees” which means that insurance companies could pay to have their plans listed prominently in the exchange. This would undermine the goal of promoting competition and creating an unbiased source of information for consumers.
• It is not accessible enough. For example, the Institute of Medicine recommended that the exchange website be accessible, that the exchange board form a technical advisory committee that includes experts in enrolling hard to reach populations, and that the exchange works with the ombudsman program at the NC Department of Insurance. 115 includes none of these provisions.
• The exchange is specifically denied the flexibility to be self sustaining or protect consumers. 115 specifically prohibits the exchange from limiting the number of plans in the exchange, even if there are hundreds of policies offered. Experience with Medicare Part D and Medicare Advantage show that this approach is confusing for consumers. 115 does not allow the exchange the ability to even study the benefits of standardizing plan design to make comparing policies easier for consumers. It also denies the exchange the ability to merge the small group and individual markets even if such a move would help consumers.
• The board of the exchange is not built around a core of independent experts. As currently written, the board has few places for the top health policy minds in the state such as Pam Silberman (CEO of the Institute of Medicine), Mark Hall (distinguished health law expert), and Mark Holmes (most respected health economist in the state). These independent experts should make up a majority of the board.
• The board of the exchange only represents the politically powerful. The North Carolina Medical Society has an appointment to the board along with the NC Hospital Association, the NFIB, and the NC Chamber. It is unclear why we represent some providers and exclude others. Why allow an appointment for physicians but not nurses? Why allow hospitals an appointment but not community health centers? Small businesses are an important voice on the exchange board, but why should they be appointed by the NFIB?
• The conflict language on the board is not well constructed. Currently nearly every member of the board could be someone with a deep financial stake in the health care system. For example, the public members can’t be employed by an insurance company, but they could work for a drug company. This entire section needs more thought and negotiation.
These are only a few points in a deeply flawed bill. We do not need to pass a health exchange bill this session. The state can still get the necessary grants to move forward with reform even if there is not legislation. We should take our time and get it right.