The Utah way of health reform

The Utah way of health reform

Summary: Conservatives seeking a model for their own brand of health reform will find their Massachusetts in Utah, where Gov. Jon Huntsman today signed four laws aimed at cutting costs without making wholesale changes in the system

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Conservatives seeking a model for their own brand of health reform will find their Massachusetts in Utah, where Gov. Jon Huntsman today signed four laws aimed at cutting costs without making wholesale changes in the system.

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The most important of the new laws is H.B. 188, which creates something Huntsman calls NetCare, a low-cost insurance plan in which coverage is guaranteed, but limited.

The idea is small businesses, individuals and those who have lost jobs but can't afford the COBRA payments needed to maintain their old care, will opt for a plan that promises to be one-third the cost.

This is achieved through higher deductibles, higher co-payments, wellness incentives, and exclusion of things like diabetes management otherwise mandated under state law.

H.B. 311, meanwhile, would require that employers offer some form of insurance to employees, which the state hopes will cut premiums by reducing cost-shifting. H.B. 165 is a healthIT bill, funding a pilot of "single-swipe" insurance technology like that now offered by Visa and A-Claim.

Finally there is S.B. 79, a sweeping bill aimed at making malpractice much harder to prove, with a higher standard of evidence and regulation of expert witnesses from out of state.

All this may prove useful in the near term. But it's an open question what happens to patients who exceed their NetCare coverage, what happens to those damaged by real malpractice, and whether this will actually curb inflation in the cost of care.

But at least conservative reform now has a model. That is a very good thing indeed, unless an experiment fails when it's applied to you.

Topics: Enterprise Software, Banking, Health

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17 comments
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  • Utah NetCare Plan

    Thanks for writing this article. I am kind of tired of blogs just copying the news articles. You have some original content in here. Thanks for that!

    I have a site about the Utah NetCare plan. It's purpose is to provide information on the latest NetCare updates to Utah residents. I will link to your article from it. It's at http://www.UtahNetCare.com. Thanks!

    Jared Balis
    Utah NetCare Specialist
    jaredbalis
    • Thanks Jared

      I have a responsibility to try and be fair in
      what I write as news, whether I agree with the
      policy or not. I have grave concerns over this
      policy, but I will continue trying to report on
      it as objectively as I can.

      Thanks for writing. And thanks for the link.
      DanaBlankenhorn
  • A step in the right direction

    The next step would be to allow a catastrophic plan with very
    low premiums. Something that would cover long-term
    expensive care like cancer, but would cover nothing else, and
    have everything else be out of pocket.

    The ultimate goal would be to introduce price competition
    into the health care market. When doctors have to start
    competing for patients based on how much they charge,
    watch prices come down. Quickly.
    frgough
    • Jaw drops

      I thought for sure you would be opposed to any and all state involvement in the issue.

      Personally, I'm glad to see Gov. Huntsman justifying my vote for him by making a conscientious effort to serve the public interest as he sees it. Most of the time, doing something that improves the system, even if it goes against what you think is ideal, is better than doing nothing.
      John L. Ries
      • Government is a necessary evil

        and sometimes it is necessary. But it should always be viewed as a
        deal with the devil. This is a step in the right direction because it is
        actually starting to remove the state from the process.

        The problem is, too many people think the government actually has
        their best interests at heart. The Founding Fathers understood that
        government tends toward tyranny. It's a lesson we forget at our peril.

        The ultimate goal should be shifting the burden of payment
        completely onto the person seeking the health care, and let there be
        private, optional catastrophic insurance for stuff that gets
        horrendously expensive.

        The government's role is tort reform to kill these ridiculous lawsuits
        and get malpractice premiums under control.
        frgough
        • Then I take it you like this plan...

          As I said, there's nothing in this that industry
          will see as against its interests.

          My concern is malpractice becomes impossible to
          prove, leading to shoddy care, and that the
          insurance doesn't cover the need, in which case
          you're right back to square one on cost-
          shifting.

          Oh, states with tort reform, like Texas, have
          seen malpractice premiums go up, not down.
          DanaBlankenhorn
      • I think Gov. Huntsman served his ideology on this

        There's nothing here that the industry should or
        would disapprove of. The NetCare plan itself is
        something the industry seems perfectly happy to
        underwrite. Then you have the medical
        malpractice bit, the healthIT bit (insurers are
        major pushers of healthIT), and the use of
        contracting authority to push people into the
        NetCare plan.

        Sounds plenty conservative.
        DanaBlankenhorn
        • That would still be serving the public interest as he sees it

          I expect responsible politicians, regardless of party, to come up with workable solutions to public problems that *they* think serve the public interest, instead of weighing either constituent mail or campaign contributions (or blindly following the party line). It's better if I agree, but I'd still rather vote for someone who can be trusted to serve the public interest as he sees it, than a hack who does whatever he thinks will get him reelected (or worse, land him a well-paying job after he's "termed out"). After all, if I can't even trust politicians to serve their own visions of the public interest, how can I trust them to serve mine?

          Rather sad that I have to make that the minimum standard, but we have to work with what we have.
          John L. Ries
          • I agree with you, John

            Gov. Huntsman sees the public interest through
            the prism of his beliefs, which conform
            generally to what Americans call conservatism.

            I don't happen to agree with him, but I admire
            his consistency. I did not mention that the
            Governor should be an early front-runner for
            2012, because that's a long way away.
            DanaBlankenhorn
    • You didn't read the Massachusetts article?

      The problem in Massachusetts is they have a lot
      of doctors, a lot of imaging clinics, a lot of
      hospital beds. Usage expands to fill the supply.

      I know this seems counter-intuitive, and I agree
      that price competition in this market would be
      exceedingly welcome.

      But there is more to value than price, in
      everything.
      DanaBlankenhorn
  • ERISA preemption

    "H.B. 311, meanwhile, would require that employers offer some form of insurance to employees, which the state hopes will cut premiums by reducing cost-shifting."

    In 1974 ERISA, the federal Employee Retirement Income Security Act, was enacted. It totally preempts the field of employee benefits, putting it under the exclusive control of the federal government. Any state legislation, rules, case-law, etc., that is contrary, is not enforceable.

    ERISA does not mandate that an employer provide any benefits. So any state law that does would be preempted. Awhile back, a city passed an ordinance requiring Wal-Mart to provide health coverage for all its employees, because Wal-Mart pays so low that most of its employees can't afford health insurance, so they become a burden on the taxpayer-funded system. Wal-Mart sued under ERISA and the ordinance was declared preempted.

    Yeah, it sucks, but the law is absolutely clear that only the federal government can regulate employee benefits.
    Rick_R
    • Another "pro-business" law that should be repealed

      If the law purports to prohibit state regulation of employee benefits, even for employers that don't do business across state lines, then it's arguably unconstitutional (whether the courts think so or not). In any case, the usual motivation to insure that states are restrained from giving employees and consumers a better deal than the lame one offered by the feds is always suspect (always cheaper to buy off 535 members of Congress than 5000+ state legislators).
      John L. Ries
      • You haven't run a Bell company

        They find it cheaper to buy the state
        legislators.
        DanaBlankenhorn
    • I was unclear and apologize

      The way they got around that was by limiting the
      mandate to those holding contracts with the
      state. The requirement is for contractors.
      DanaBlankenhorn
  • Sounds inefficient

    By pushing the cost of what is basically universal
    care for the employed they seemed to have set up
    the worst system possible.

    Employers will see this as a additional cost of
    labor - just when we want to motivate them to add
    employees. Compared to a system financed by
    taxes on income and profits Utah simply punishes
    the employees.

    As for tort reform, we let juries decide if a
    convicted murder heads to death road. Why not
    give them the same credit of judgement on
    medical SNAFUs & FUBARs?

    The potential of a law suit is a silent policeman
    helping you get far better care than you would if it
    was banned. II believe that most medical
    professionals are pretty good. Some are smarter
    or "better" than others, but they work hard and do
    a good job. There is a small percentage that
    should not be in the profession and your only help
    if you get one of these is the potential of a law
    suit.
    Ken_z
    • This goes beyond tort reform

      Here they are getting into the court process
      itself, mandating a higher standard of proof,
      and trying to get rid of out-of-state experts.

      By writing the law on malpractice to make it
      impossible to prove malpractice, you're doing
      more for employers than just limiting damage
      awards.

      It's quite clever.
      DanaBlankenhorn
  • RE: The Utah way of health reform

    MikeOliphant - 3/25/09
    Please visit the source that is more closely involved in the process of H.B. 188 which incorporates the Utah Netcare Plan. http://www.uahu.org and http://www.BenefitsManager.net
    I have been closely involved in this process and attended most of the meetings at the hill. I have also presented to the "Insurance Task Force" a plan to answer the uninsurable issues. I really believe that the legislators have the best intentions. I do not believe this is a good advancement for Utah healthcare reform. It has not reformed anything when you come down to the nuts and bolts. However, I would agree this is a good first step in the right direction.
    MikeOli