BC/BS of Minnesota's individual mandate proposal
BlueCross BlueShield of Minnesota
Unfinished Business
A discussion paper on the need for universal health coverage in Minnesota
A Universal Coverage Model (a few selected features)
- A mandate for all Minnesotans to have coverage
- People who do not comply with the mandate to have coverage are subject to a “fair share” penalty based on income and related to what they would pay for coverage. As an added incentive to comply when the mandate takes effect, people who are noncompliant could be subject to a pre-existing condition limitation for a specified time period when they do apply for coverage.
- Enforcement through employers and the tax reporting system, with a mechanism created to which employers can refer their uninsured employees to asses subsidy eligibility or what their fair-share penalty is. Employers could then deduct this amount from payroll.
- All insurers doing business in the small and large group markets must participate in the individual market by offering at least three pre-defined products.
- Losses for insurers’ high-risk pool are subsidized through a fund that is subsidized by the state.
- Continued support for disease management programs
- Regulatory flexibility to allow for new benefit structures and cost-sharing models
- The proposal assumes a set of benefits for modeling purposes, but the ethical discussion of how a coverage mandate can be made affordable must be undertaken by all Minnesotans, to have a chance of successfully achieving universal coverage.
And…
Will Mandatory Health Insurance Work?
by Greg Scandlen
National Center for Policy Analysis
September 6, 2006
Policymakers can get an idea of how well mandatory health insurance would work to reduce the number of uninsured by looking at another type of mandated coverage. Consider:
- All but three states mandate automobile insurance, but 14.6 percent of America’s drivers remained uninsured in 2004, according to the Insurance Research Council.
- No state mandates health insurance, but 17.2 percent of the population lacked health coverage in 2004, according to the Employee Benefit Research Institute.
…perhaps the biggest lesson from these comparative statistics is the success of a completely voluntary market. Not one state yet mandates health insurance, but people are covered anyway - at virtually the same rate as auto insurance.
States should not consider mandating the purchase of something unaffordable and inefficient before pursuing policies that make coverage more affordable for more Americans.
Conclusion. There are no easy solutions to America’s health insurance problem. The current notion that a state legislature can solve the problem through mandatory coverage is naïve at best and a distraction from the hard work of finding real solutions.
http://www.ncpa.org/pub/ba/ba569/
Comment:
By Don McCanne, MD
The BC/BS of Minnesota plan is obviously self-serving. It would expand their market to everyone, allow them to sell innovative plans with increased administrative income but decreased protection for patients, and would shift the losses of high-risk patients to the taxpayers. In this report, BC/BS specifically acknowledges the fundamental problem of all individual mandate programs: they have not been able to figure out the ethics of making an individual mandate affordable. Do they make insurance premiums affordable and expose patients to great financial risk? Or do they provide bona fide insurance coverage that many cannot afford, and then punish them for failing to buy it?
Greg Scandlen is an advocate of consumer-directed health care, especially health savings accounts and high-deductible health plans. Although we certainly disagree on our respective models of reform (single payer versus consumer-directed), we do agree that the concept of an individual mandate in the private insurance market should be laid to rest.