Senate Health Week Update III

The Senate majority leadership’s push to pass the Enzi small business healthcare reform bill has stalled, according to the Washington Post, and the minority leadership may apply the coup de grace today. The President has endorsed this bill; the House has passed a substantially similar version (H.R. 525) last year, and business community strongly supports it. However, the Democrats, state insurance regulators, many insurance companies, and patient advocate groups oppose it.

Steven Pearlstein of the Washington Post had an interesting health care reform in yesterday’s paper and held an online chat to discuss his article. In his article, he mentioned three “fresh ideas” for small business health care reform:

  • A plan offered by Katherine Swartz of Harvard’s School of Public Health to have the federal government provide specific stop loss insurance for claims over $50,000 (subject to 10% coinsurance) funded by a tax on premiums. “This would equalize premiums and reduce the incentive for insurers to ‘cherry-pick’ the healthiest employee groups.”
  • A plan offered by Michael Porter of Harvard Business School and Elizabeth Olmsted Teisberg of the University of Virginia’s Darden School of Business to price fix all hospital and physican charges regardless of payor. “That would eliminate the massive cost-shifting that favors big employers and big insurance companies.” (Of course the most massive cost shifting is done by the federal government’s Medicare, Medicaid, and TRICARE program not these payors, and in my view, you can date the health care cost problem from the time when Medicare shifted to a prospective payment/DRG system for compensating inpatient hospital care in 1983. But it’s always easier to blame the insurance companies.)
  • The recently enacted Massachusetts state mandate requiring the purchase of health insurance.

If these were the freshest ideas that we’ve got, I would be worried.