PENNSYLVANIA SHOULD PRESERVE AND STRENGTHEN
GOVERNOR'S HEALTH PROPOSAL, ANALYST ADVISES
Pennsylvania lawmakers should preserve and strengthen key elements
of Governor Rendell’s health care proposal, an analyst from the Center on
Budget and Policy Priorities told the House Insurance Committee today. The
proposal, now before the House as the Pennsylvania Health Care Reform Act,
aims to expand access to health care and improve quality while reducing health
care costs.
Judith Solomon, a senior fellow at the Center, commended lawmakers
for taking on the challenge of helping the estimated 800,000 uninsured adults
in Pennsylvania obtain coverage. But failure to endorse important parts of
the governor’s plan — such as reforms to the health insurance market that have
been criticized by some private insurers — could prevent the plan from
achieving its goals, she cautioned.
“The various pieces of Pennsylvania’s plan are interdependent, so
major changes in one part of the plan could undermine the plan as a whole,
preventing the state from making real progress toward more accessible and
affordable health care,” Solomon said.
The bill before the House would prohibit all private health plans
operating in the state from varying their rates on the basis of health
status. Insurers also would be forbidden to exclude treatment of pre-existing
medical conditions. These reforms would help keep health coverage affordable
by spreading the cost of insuring the sickest Pennsylvanians as widely as
possible.
“Without these reforms, the new Cover All Pennsylvanians health
care program would end up serving mostly people who are in poor health, and
over time the cost of that coverage would become much higher,” said Solomon.
“That’s why it’s absolutely critical that the insurance reforms in the bill be
maintained.”
Solomon also expressed support for the section of the bill
providing subsidies to help Pennsylvanians with income up to 300 percent of
the poverty line to buy health coverage. Unsubsidized coverage could cost a
family at this income level more than one-sixth of its entire income, she
noted.
In addition, Solomon suggested that lawmakers
ensure that Cover All Pennsylvanians provide comprehensive coverage that meets
the needs of people with chronic conditions and other health problems, as well
as providing preventive care and other routine services to all participants.
She also warned against high deductibles or other forms of cost-sharing that
would make it hard for participants to get care. To help pay for the new plan, Solomon advised Pennsylvania to
redirect some of the federal Medicaid funds it receives to assist hospitals that
care for the uninsured. (These funds are known as “disproportionate share
hospital” [DSH] payments.) Federal funds can be used for the plan only if
the state’s total federal Medicaid funding does not increase, Solomon explained.
The only other way to meet this federal budget-neutrality requirement — cutting
spending in the state’s regular Medicaid program — would likely harm low-income
Pennsylvanians.
Pennsylvania reportedly has some $90 million in unspent DSH
funds, so diverting some of the unspent funds to help pay for the plan should
not affect hospitals’ ability to care for the uninsured.
The House Insurance Committee will conclude hearings on
the plan later this month, and the House is expected to take the plan up before
it recesses at the end of June.
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The Center on Budget and Policy Priorities
is a nonprofit, nonpartisan research organization and policy institute that
conducts research and analysis on a range of government policies and programs.
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