August 3, 2001
by Samuel Goldreich, CQ Daily Monitor
“The House also adopted, 236-194, an amendment (to HR 2563, the patients’ rights bill) by Ways and Means Chairman Bill Thomas, R-Calif., that would remove limits on the number of people who could set up tax-sheltered medical saving accounts (MSAs) and allow small businesses to join “association health plans” (AHPs) that could purchase insurance under federal, not state regulation.”
Health Affairs Volume 20, Number 1 “HealthMarts, HIPCs, MEWAs, and AHPs: A Guide for the Perplexed” By Mark A. Hall, Elliot K. Wicks, and Janice S. Lawlor
“… these proposals could erode previous market reforms whose goal is increased risk pooling.”
“A case can be made that HealthMarts and AHPs violate the principle ‘first, do no harm.’ They are unlikely to generate true efficiencies, and they partially undermine existing regulatory and market structures.”
Comment: The debate over the patients’ bill of rights has been widely attacked for merely attempting to tweak managed care, when our legislators should be addressing the real problems with our health care system. We need comprehensive reform, which should include elimination of the egregiously wasteful managed care middlemen. But until we can create the political will needed for reform, we do need to establish accountability for this industry through an effective patients’ bill of rights. The Norwood amendment significantly weakened the provisions of this legislation and will need to be reversed in the joint conference committee.
Those of us that have attacked this process as grossly deficient, considering the great needs for comprehensive reform, are particularly concerned not so much about the Norwood amendment, but rather the Thomas MSA-AHP amendment. Congress needs to act to provide comprehensive coverage for everyone. The Thomas amendment proceeds in the opposite direction! MSAs allow the healthy and wealthy to opt out of existing programs. This removes from the risk pool necessary funds to meet the medical needs of the sick, but, more importantly, it removes from the risk pool the political drive to assure that it will always be adequately funded. The poor do not have the same intense political influence of the affluent. Thus the under-funded care available to not only low-income but also average-income individuals will culminate in mediocrity. AHPs also risk removing healthy individuals with established incomes from the risk pool. Further, AHPs are intended to relax state control over insurance coverage, allowing abusive practices of insurers and association managers to proliferate, which would impair coverage for and remove choice of the intended beneficiaries. It is absolutely imperative that the Thomas amendment be amputated in the joint conference committee. And then let’s get on with the task of establishing a program of publicly administered, universal health insurance.