Legislation on insurance will have to be paid for

The 90th Missouri General Assembly has convened in Jefferson City. As the legislators work through the 1,500-plus bills filed each year, they deal with many different issues which are important to all of us.

Year after year, many of these issues relate to health care and medical insurance. In those two categories alone, 126 bills have been filed and four additional resolutions offered.

Medical insurance bills deal with everything from tax credits to contraceptive coverage to the Missouri Universal Health Assurance Program.

Health care bills consist of many of the same issues, plus laws ranging from regulation of stretcher van operators to the Tobacco Settlement Trust Fund.

Of these 126 bills, I believe the following two bills have the most impact on health insurance:

House Bill 1362, sponsored by Rep. Tim Harlan, a Democrat from Columbia, has passed the House, been amended five times and has been placed on the Informal House Calendar in position No. 1.

Senate Bill 820, the companion bill in the Senate, has been read on the Senate floor and heard in committee twice.

Both bills deal with making changes in the Missouri Health Insurance High Risk Pool and the establishment of an advisory committee on health insurance mandates.

Each of these bills also:

Modifies the Missouri Small Employer Health Insurance Act provisions to comply with the federal Health Insurance Portability and Accountability Act;

Creates rating restrictions on individual health insurance policies;

Establishes a health benefit reinsurance association for insurers writing business in Missouri;

Authorizes a grant program to create health insurance purchasing cooperatives.

While many of these are good ideas, what are the ramifications of this legislation?

Supporters say these bills are needed so the self-employed or those who work for small employers can obtain insurance at reasonable rates, even though they represent a higher risk. It would allow the uninsured to have access to more affordable rates, and it would also provide risk sharing for losses incurred by the insurance companies.

The fact is, it will cost money and lots of it to accomplish these goals. HB1362 in its current form will have a traumatic effect on the health insurance industry as a whole. Certainly, some segments of this state's population would benefit from this bill. However, both we in the industry and the members of the General Assembly are obligated to do what is in the best interest of the greater good.

According to the fiscal note attached to the bill, the estimated total net cost to the Missouri General Revenue Fund by fiscal 2003 is anywhere from $3.4 million to just over $20 million. And guess where that money comes from? Taxes: sales tax, income tax and insurance premium surcharge tax, to name just a few.

Bear in mind, this does not include the cost incurred by the health insurance companies. And we all know who has paid, is paying and will pay those costs. In case you have forgotten, look at your pay stub or your accounts payable ledger.

Opponents of the bill also point out that not only is the estimated cost high, but the opportunities to be insured would diminish. Many insurers will be forced to discontinue writing policies in Missouri because they will not be able to make a fair and reasonable profit.

In addition, many insured people will terminate their coverage because of the increased costs. These costs will have increased not only because of inflation and utilization, but also because of reform measures that will not accomplish the goal. Twenty million dollars is a lot of money.

Yes, these are trying times in the health insurance industry, but we also need to remember the past few years of medical deflation in southwest Missouri. Many people agree that the easy picks to save money like steerage, capitation and gatekeepers have done all they can do.

It is now up to us individually to make educated choices, healthy decisions and to take more personal responsibility in how we spend our health care dollars. Health insurance is a product that is purchased so that someone else assumes the financial risk of health care. It is not a right, but a privilege.

For a complete 13-page listing of the state bills, the Internet addresses are:

www.house.state.mo.us/bills00/sbjndx00/sbj260.htm

and

www.house.state.mo.us/bills00/sbjndx00/sbj227.htm.

Scroll through this list to learn the latest House and Senate action, review bill summaries and become educated about the items up for consideration.

If you have concerns or questions about House Bill 1362 or Senate Bill 820, call your legislators and let them know how you feel.

(Mike Scott works in the Employee Benefit Division of BPJ Insurance.)