Insurance Exchange Bill Likely to Progress Without Much Change

The fight for a stronger health insurance exchange in Oregon will likely take place beyond the legislative session as lawmakers look to pass a compromise bill
April 21, 2011 -- A month ago, Rep. Mitch Greenlick (D-Portland) told his Senate colleagues that he wouldn't vote for a bill creating a health  insurance exchange if it included commissions for insurance brokers. 
“I might have to fall on my sword on that one,” said Greenlick, ever the pragmatist Wednesday in his office at the state capitol. 
As long as Senate Bill 99 continues to say that the final business plan must come back to the legislature for approval next February, in the 2012 session, Greenlick doesn't foresee any problems, politically speaking.
“I’d rather not have any arguments about what’s in the business plan before we get the business plan,” he said.
By taking such a position, Greenlick's ignoring opposition from consumer advocacy groups such as OSPIRG and AARP Oregon. 
“Advocates have expressed concerns and provided amending language at each step of the process in the Senate, and those concerns have not been addressed,” said Rick Bennett, lobbyist for AARP Oregon. “It’s supposed to be a bill to benefit consumers and small businesses. But you have most of the consumer advocates not supporting the bill. That suggests to me there’s a problem here.”
One of the main issues involves whether the exchange, slated to be a public corporation with a governing board, should have the authority to negotiate for lower premiums.
“That turns it into more of a regulatory body rather than really accomplishing the mission of providing a mechanism for people to get subsidies and increase choice,” said Tom Holt, director of legislative and regulatory affairs for Regence BlueCross BlueShield of Oregon. 
All along, consumer advocates have argued the exchange should push its regulatory authority as much as possible rather than simply act as a Web site for individuals and small businesses to purchase  health insurance.
“Any plan that meets the minimum standards can be in the exchange,” Bennett said. “That’s not much different than what you have in the current marketplace.”
Holt said the bill strikes a tenuous compromise. “It’s a good compromise and also a very delicate compromise. If the bill has significant changes, we’re at high risk of not being able to have a bill credibly on its way to meet the deadlines in federal law by 2014.”
A federally mandated insurance exchange could be worse for Oregonians because it would be driven by much different and much larger markets.
Holt praised the consumer choice that will come with the exchange, particularly for small businesses. There would be three tiers of coverage, enabling employers to buy insurance as a group, yet offering employees access to a range of health plans across a certain level of coverage within the exchange.
“That’s a good thing for consumers,” said Holt.
Consumer advocates also want tighter conflict of interest restrictions on the board which will govern the exchange. As it stands now, two of those board members could come from the healthcare industry. For those and other reasons, pressure for a stronger exchange will continue.
“It’s a shadow of what a good exchange could and should be,” Bennett said. “It’s frustrating for a state like Oregon that’s supposed to be progressive.”

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