The arguments go something like this:
If consumers could buy health insurance across state lines, they would have more plans from which to choose, fostering more competition that in turn could mean lower prices.
That change is espoused by many in the health care debate, especially Republicans, who oppose a dramatic overhaul of the health care system, such as the public option.
“Whether it is allowing small businesses to form associated health plans, allowing individuals to purchase health insurance across state lines, or by curbing frivolous lawsuits,” said U.S. Sen. Roger Wicker, R-Miss., “there are a number of measures that could pick up bipartisan support and help make health care more affordable and accessible.”
The recently passed House bill on health care heads in that direction.
According to Kaiser Health News, the legislation would allow states to form compacts that would enable consumers to buy policies from insurance companies licensed in any of the states governed by the agreement.
A consumer’s home state would retain authority to handle disputes.
The Senate Finance Committee bill enables insurers to create nationwide plans, and insurers would have to be licensed in each state where they sell the plans.
However, the insurers also would have the authority to offer only those benefits mandated by the majority of states.
How it works
In Mississippi, like every other state, consumers now can buy policies only from insurance companies that are licensed in the states where they live.
That’s because of a federal law enacted in 1945, the McCarran-Ferguson Act, which gives states the authority to regulate the “business of insurance” without interference from federal regulation, unless federal law specifically says otherwise.
“Buying across state lines” would suggest that consumers face few choices within their own states. And that’s true to some extent. In some states, one or two companies have the lion’s share of the market, and that, some people say, allows the insurers to charge consumers more.
In Mississippi more than 330 companies sell health insurance in the state now, although more than half of the market belongs to three major players: Blue Cross & Blue Shield of Mississippi, with 39.3 percent; United HealthCare (9.7 percent) and Humana (8.0 percent). The remaining 43 percent of the market is shared by the rest.
All told, the companies wrote more than $3 billion in premiums last year and paid nearly $2.5 billion in claims in the state.
“Health care is available and people have options,” said Mike Chaney, commissioner of the Mississippi Insurance Department. “But I do agree that we do need health care reform and that people need more access.”
Health insurance rates in Mississippi are “on par” with neighboring states, Chaney said.
Paul Mize, a senior vice president for insurance agency Ross & Yerger in Tupelo, agrees.
“We find rates for a lot of clients, and when you compare them to Tennessee, Alabama, Louisiana, we find rates to be competitive,” Mize said.
But neither Chaney or Mize is saying that there isn’t room for improvement.
They know that health care delivery and capability vary and that insurance plays a critical role in what consumers receive.
Eliminating pre-existing conditions, which many insurance companies cite for denying coverage and claims, is one important step that needs to be taken, Mize said.
“Insurance is a means, not an ends, though,” he added. “I don’t think having insurance is the answer to everyone’s problems.”
Mize and Chaney say greater emphasis on maintenance and preventive care would help lower health care costs long-term.
“You can’t tell me that if you stop smoking or lose weight that you’re not going to be healthier and that your medical costs won’t go down,” Chaney said.
Not waiting for solution
Many believe that health care reform is likely in some form or fashion, and discussions about having a public option and developing a single-payer system raise concerns.
In general terms, a single-payer system would funnel all medical bills through a single source, such as the federal government, which would “pay” the bills. Medicare is an example of the single-payer system being used in the U.S.
“As a regulator, I expect companies doing business in Mississippi to pay claims within 30 days,” Chaney said. “I don’t know that would happen with a single-payer system with the government because it takes Medicare and Medicaid payments 60 days or more. So I’m not sure how that will be addressed.”
Mize said his clients know some sort of health care reform is coming.
“They’ve never waited around for government to run their business,” he said. “They know changes are coming … but they’re not looking to the government for solutions, and there’s a bit of fear about what might happen.”
Adding millions of previously uninsured people and providing them insurance comes with a price, and many businesses fear they’ll have to bear much of burden.
And Chaney isn’t sure requiring everyone to have health care – also in the House bill – is a workable solution, either.
“We’ve never in this country required everyone to buy something – we’ve always had options,” he said. “People will say that car insurance is required. Yes, but only if you choose to drive. I don’t know the ramifications of mandating everyone to provide health insurance or get health insurance.”
Contact Dennis Seid at (662) 678-1578 or firstname.lastname@example.org.
Dennis Seid/NEMS Daily Journal