HEALTH MATTERS

A Spring Thaw?

Fri. May 2, 2008


If you listen closely, you might just be able to hear the sound of ice cracking. No, it's not global warming. It's actual bipartisanship breaking out on health care -- and in a presidential election year, too.

Imagine that? This week alone Congress cleared -- and President Bush is poised to sign -- a genetic nondiscrimination act that has been mired in the legislative process for more than a dozen years.

Legislation to require mental health parity, in limbo for nearly as long, remains a possibility to emerge from conference before the end of the session, and there appears broad bipartisan support for a bill to require electronic prescribing by physicians for patients in the Medicare program.

Meanwhile, the House last week passed, by more than a veto-proof margin, legislation to put the kibosh on seven Medicaid regulations issued by the Bush administration, although there is less consensus on that one in the Senate.

Still, after more than a year of discord and name-calling about Medicare and the State Children's Health Insurance Program, it seems a partisan thaw might be setting in on healthcare matters.

Perhaps the most surprising healthcare accord is one that has gotten almost no notice. Since the crash-and-burn of former President Clinton's healthcare reform plan in 1994, there has been a mostly partisan split over how to help small businesses help their workers get coverage.

Everyone agrees that small employers should be able to somehow pool their purchasing power. But they've divided, nastily, on how.

Republicans, a few Democrats, and the National Federation of Independent Businesses have pushed hard for association health plans, or AHPs.

They would allow associations -- not coincidentally, like the NFIB itself -- to act as the pooling mechanism, letting small employers purchase coverage that would be cheaper not only because they would be part of larger groups, but because the plans would be exempt from most state insurance regulations. Instead, the AHPs would be regulated by the Labor Department.

Most Democrats, consumer groups, governors, and their state insurance commissioners thought that was a terrible idea. They said the Labor Department already had a poor track record regulating multiemployer health plans, and that the lack of state regulations was an invitation to bare-bones coverage and fraud.

And so the stand-off continued. Until last month, that is, when some of AHP's strongest backers and strongest opponents announced a compromise.

The "Small Business Health Options Program" or SHOP bill, would preserve the idea of allowing small businesses to band together to spread risk over a large number of workers.

And it would allow plans to be offered on a nationwide basis. But it would also retain state insurance regulation for key consumer protections. And to add to the appeal, the measure would offer tax credits for the self-employed, as well as for small business owners who pay for at least 60 percent of their workers' premiums.

Nearly as surprising as the list of co-sponsors -- which include Sen. Olympia Snowe, R-Maine, a longtime backer of AHPs in the Senate, and Senate Majority Whip Durbin, one of the most outspoken opponents of the concept -- is the list of organizational backers.

It includes both the NFIB and the Service Employees International Union. Those are two groups that have not been traditional allies, but have recently come together as part of the Divided We Fail coalition working to establish health reform as part of a broader financial security agenda.

But as warm and fuzzy as these moments might be, don't mistake them for anything approaching a solution to the healthcare debate writ large.

That's as big and polarizing as ever. We got a couple of reminders of THAT this past week, too.

On the presidential campaign trail, the presumptive Republican nominee, Sen. John McCain of Arizona, renewed his call for health reforms based on individual, rather than employer-based coverage.

McCain was immediately hammered by a wide array of Democrats, not just his potential rivals in the presidential contest: Sens. Hillary Rodham Clinton, D-N.Y. and Barack Obama, D-Ill.

"There's a lot of elements of free-market theology that are substituting in this proposal for serious thinking about how we address the twin problems of rising healthcare costs and declining coverage," said Jacob Hacker, the Yale University political science professor who developed proposals on which Clinton and Obama based their plans.

Even more ominous was a warning this week from HHS Secretary Leavitt. Speaking as a trustee of the Medicare program, Leavitt gave a speech urging Congress to act sooner rather than later to do something about the vast health program's unfunded liabilities -- before it causes a generational war.

But he cautioned that Congress will have to find a way to do it other than regular order. "The usual legislative process won't ever produce enough bipartisanship to deal with this problem," Leavitt said. "The way election cycles operate now, only a few months separate the time one election cycle ends and the next one begins." The thaw only spreads so far.

by Julie Rovner

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