Experts weighed in on a public option – and now it’s our turn!
March 6, 2019
Picture a health insurance market that offers quality and affordable health care. With proposed House Bill 7267 – An Act Concerning Public Options For Health Care in Connecticut, the state would be creating public options that would help do just that. Hearings on the bill are on Thursday, March 7 and we plan to be present to show our support.
This action comes after much legislative attention to increase health care access and affordability in the state. Legislators have repeatedly brought up the concerns they heard on the campaign trail about health care affordability – and now are working on addressing these concerns.
Several public option bills have been proposed this session. HB 7267 is unique, focusing on increasing access to competitively priced, quality and state-backed health insurance for individuals and small businesses. We see HB 7267 and the most expansive approach to be proposed this session.
Experts weighed in on a public option at February 13 informational hearing
As we wrote in a previous blog, states around the nation are exploring public options for health care. February 13 the Insurance and Real Estate and Human Services Committees of the Connecticut state legislature held a joint informational hearing to learn more about a public option for Connecticut (you can watch it via CT-N here). Also, the following week on Feb 21, the CT News Junkie held a public forum on the public option (available to watch here).
During the February 13 hearing, lawmakers heard more about a how a public option could work and the kinds of problems a public option could address for Connecticut.
How would a public option work?
States have several choices to make when designing a public option. A state can design the option as a new government-backed health plan that would operate as a nonprofit and compete against private insurers. Other states in the nation are looking to open existing programs, like Medicaid, for individuals to purchase on their own.
HB 7267 takes the former approach. For the small group market, HB 7267 proposes that the Comptroller open the state employee plan to offer coverage to small employers and their employees. The new enrollees would enter the existing pool of beneficiaries. For individuals, the Comptroller’s office would leverage the purchasing power of the State Employee Health Plan to create a plan individuals can buy.
Offer quality insurance with broad benefits
Enrollees in the plan should be able to expect predictable and modest out-of-pocket costs. At the Feb 13 hearing, Professor Jacob Hacker (of the Yale Institution for Social and Policy Studies) stated this as a major goal of a public option. Enrollees should expect the public option plans to provide coverage for essential health benefits and be qualified health plans.
Expand access by offering competitively priced plans
To this day, individuals are experiencing the same burdens since before the ACA. Indeed, a public option is very necessary because ACA subsidies are not generous beyond modest income Americans. This was first noted by Jacob Hacker at the Feb. 13 hearing. Individuals falling above 400 percent of federal poverty level do not receive marketplace subsidies – and often struggle with affording monthly premiums, not to mention out of pocket costs.
Simply, the public options will benefit those left behind. The public options could also expand access to families falling in the ACA “family glitch” – this is where some families cannot obtain ACA subsidies when just one individual receives employer sponsored insurance. Also, the public options will allow individuals who cannot obtain insurance, including undocumented residents, to have access to affordable care, Representative Sean Scanlon said at the Feb. 21 public forum.
In the Connecticut market, only two companies are currently providing individual coverage and only a few more offer small group coverage. It was the first fact discussed at the Feb 13 hearing. The public option will foster necessary competition in the state. It does not replace the health plans offered by private insurers on and off the state health insurance exchange, Access Health CT. It does not replace employer-sponsored coverage. And lastly, it does not replace Medicaid or affect Medicare.
Start small, with a less-risky pool
According to the bill’s text, the first step in a public option would be opening the state employee plan to small businesses.
In the legislative hearing, State Comptroller Kevin Lembo started by saying that 700,000 CT residents, or half of the state’s workforce, work in small businesses and stated the major need to offer incentives to attract talented employees. He noted that there are 190,000 lives in the state employee plan right now. He said the state must be committed and that “anything that fits neatly into a soundbite” is problematic.
In the information hearing, Representative. Scanlon addressed concerns with numbers. He said that if there are 700,000 CT residents employed by small businesses, and if the state employee plan was open to them to purchase insurance, even if half of the population or a third of them did it, it still leaves an “incredibly large small group market that would be able to access insurance” in the private sector.
In the hearing, Mr. Lembo said frankly: “If you said to me today that I want to go small employers and individuals in one bite and I want it to happen right away, I would then be an opponent.” But he noted an important fact: that the risk-profile of small businesses is similar to the population on the state plan.
So, where do we go from here?
There certainly is a lot to consider. Plan and benefit design. Start-up. Buy-in from labor. Cost-sharing. Shared savings. Negotiating for prices. All of these were noted by Comptroller Kevin Lembo. There is much for experts to decide, and like Dan Meuse, of the State Health and Value Strategies at Princeton, said, there is no model to build on yet because no state has done this.
Now it’s our turn to speak up for a public option! JOIN US MARCH 7!
The proposed bill, No. 7267, is a good step for Connecticut to expand its access to affordable and quality health insurance. Fifty percent of Connecticut residents experienced health care affordability burdens in the past year, according to a recent survey, and most of those residents express strong support across party lines for policymakers to address these problems. Now is the time for Connecticut to act.
Join us at 10 am on March 7, 2019 to show your support for the public option (learn more here!). All are encouraged to submit testimony or testify in person at the hearing. As always, let us know your story of how this bill would help you or a loved one.
You can RSVP here if you can make it!
Check out these talking points on the public options bill