Schumer And Snowe Negotiating 'Safety Net' Public Plan Trigger
Inside CMS, June 24, 2009
As momentum in the Senate for health reform legislation seems to have slowed, a progressive Democrat and a moderate Republican on the Senate Finance Committee are working on a middle of the road “safety net” proposal they hope will garner bipartisan appeal. The proposal from Sens. Olympia Snowe (R-ME) and Charles Schumer (D-NY) would allow private insurers to bid on a meaningful benefit package that is affordable state-to-state, a Snowe aide tells Inside Health Policy. If the plans are unable to affordably insure a certain percentage of patients in each state, a public “safety net” plan would kick in.
Under the proposal, plan benefits by 2013 would mirror those contained in the current Federal Employees Health Benefits Package: preventive and primary care, physician services, emergency services, hospitalization, day surgery, outpatient services, outpatient surgeries, anesthesia, imaging, X-rays, maternity newborn care, prescription drugs, radiation and outpatient cancer therapy, mental health and substance abuse services.
The strategy is to create state-by-state “safety net” plans that would be available by 2013, but wouldn't be “triggered” unless the private plans fail to offer meaningful, affordable coverage. The process would entail the private plans offering bids for coverage and an opportunity to rebid for patients. The public plan -- run by HHS or a new government entity -- would kick in if after the rebid the plans are still unable to provide affordable coverage for patients.
The “safety net” proposal is an attempt to meld the two plans the lawmakers have been working on: the New York Democrat's “level playing field” plan and the Maine Republican's “fallback” plan now being dubbed a “safety net” plan. It comes after a compromise based on co-ops, floated by Senate Budget Committee Chair Kent Conrad (D-ND), failed to gain the support of liberals on the Finance Committee. House members -- and liberal activists -- also assailed the idea.
Schumer and Conrad were working on a compromise co-op proposal, but Conrad said the plan ran into problems when GOP members refused to accept several of Schumer's priorities. Schumer had said that any co-op has to be national, must have sufficient federal funds to start off, and must remain independent of insurance companies.
Despite earlier speculation that the idea was dead in the water, Conrad believes the idea is very much alive, and on Monday indicated that he was warming to Schumer's ideas.
Schumer's willingness to work with Snowe to design a viable “fall back” option comes a month after the New York Democrat railed against a trigger option based on competition-based benchmarks. During a teleconference organized by Health Care For American Now, Schumer said that a report showing that 94 percent of the insurance market is highly concentrated and anti-competitive “blows away” any notion that a trigger plan is needed since any criteria for inserting a public plan down the road have already been met.
But speaking to reporters after meeting with Snowe for an hour Tuesday (June 23) morning, Schumer sounded open to compromise but didn't go into specifics. “I don't care what exact form (a public option) takes as long as it has all the traits that are needed to keep the insurance companies honest and it's available everywhere in the country,” he said, according to Congress Daily.
Snowe said she envisioned that the proposal could potentially operate alongside Conrad's co-op proposal, Congress Daily reports, and that senators aren't optimistic that the Finance Committee could reach a deal on legislation this week. A selling point for Senate Republicans, the Snowe aide tells Inside Health Policy, is that they voted as part of the Medicare Modernization Act for a Part D “fallback” plan. The aide suggested that the “safety net” plan is a similar proposal.
A compromise “triggered” public plan was also unveiled last week by former Senate majority leaders who are members of the Bipartisan Policy Committee (see related story).
The compromise attempts come in the face of strong criticism against a “Medicare for all” proposed by Democrats or even a “level playing field” plan from Republicans and some moderate Democrats. A public plan option run by Medicare or overseen by HHS also has drawn a rebuke from the insurance lobby, which wrote a letter to Senate health committee Chair Edward Kennedy (D-MA) Friday (June 19) saying such a plan would devastate commercial insurance.
“A government plan option -- in any form -- is unnecessary to achieve comprehensive reform and would have devastating consequences on the health insurance coverage that employers and individuals currently have, the federal budget deficit and existing provider systems,” America's Health Insurance Plans and the Blue Cross Blue Shield Association wrote in a June 19 letter to Kennedy.
“A government-run plan -- no matter how it is initially structured -- would dismantle employer-based coverage, significantly increase costs for those who remain in private coverage, and add additional liabilities to the federal budget,” AHIP and BCBSA wrote.
This blanket opposition to a public option seems to extend to the compromise “safety net” proposal that Schumer and Snowe have been trying to develop.
Asked during a news conference Tuesday if health reform needs to include a public option, President Barack Obama said it's an “important tool to discipline insurance companies,” but added that there should be a debate in Congress about what shape that plan should take (see related story). -- Brett Coughlin ()