Health-care reform for grown-ups

The Rocky

Sunday, April 6, 2008

State Sen. Bob Hagedorn's approach to health-care reform is refreshing. The Aurora Democrat does not try to do too much.

After the futile efforts of the state's wildly ambitious Blue Ribbon Commission on Health Care Reform, the Aurora Democrat has swept into the debate like a sober clean-up crew, stubbornly refusing to push hyperexpensive reform in health-care delivery and instead focusing on patching the widest gaps in insurance coverage.

If his Senate Bill 217, the "Centennial Care Choices" plan, becomes law, it might well lead to durable reforms that bring more people under the insurance umbrella at an affordable cost.

SB 217 would not rely entirely on higher government subsidies to cover the uninsured, as proposals to establish a single-payer medical system, expand Medicaid eligibility or let adults qualify for the State Child Health Insurance Program would do.

Instead, the bill would instruct state health-care policy officials to solicit from the insurance industry "value benefit plans" - low-cost, stripped-down medical policies targeted at Coloradans who earn too much to receive Medicaid but don't buy insurance.

Insurers would have until Aug. 1, 2009, to submit plans for state review that are actuarially sound. The intent is to bring about something approaching universal coverage using private insurance, even if none of these value plans offers a full array of benefits.

The legislature would have to either approve or reject the plans. Lawmakers could not load them down with mandates for procedures or treatments that might make them economic losers for insurance companies.

Hagedorn believes that a robust variety of value plans could reduce by half the ranks of the uninsured. This could ease the cost-shifting that occurs when uninsured patients get treatment they cannot repay, forcing hospitals and doctors to write off the costs.

Such uncompensated care totals $600 million in Colorado, according to the blue ribbon commission. And people who don't have insurance are less likely to get routine treatment, which means they may wind up in emergency rooms for otherwise preventable conditions.

Along with the value benefit plans, the bill requires the governor to offer proposals to subsidize lower-income workers so that they can enroll in a plan or get insurance from their employers.

Two aspects of SB 217 give us pause. First, it includes an individual mandate, requiring every uninsured Coloradan who is not enrolled in a government program to purchase coverage. But we can live with this so long as value benefit plans are indeed viable and available at modest costs.

The second is the strong possibility that a tax increase will be needed - as early as 2010 - to subsidize coverage for low-income workers. Hagedorn believes that covering the uninsured will reduce cost-shifting and minimize the money that will be needed from state coffers. If voters reject any proposed tax increase, then the subsidies to fully fund SB 217 won't be available, limiting the legislation's ability to cover all Coloradans.

In any case, SB 217 would build on the strengths of the current health-care system, not wreck it. And if the value plans, the subsidies and the tax funding don't make sense to insurers, policy-makers or voters, they won't become law.

We'll never know if this innovative approach can work unless it's given a chance, and that's why we urge lawmakers to approve Hagedorn's idea.