Health plans proposal poses access problems
By Cynthia Dailard
Senior Public Policy Associate
The Alan Guttmacher Institute
Washington, DC
The Bush administration and conservative members of Congress are touting legislation to create Association Health Plans (AHPs) as one of their answers to the growing problem of the nation’s uninsured, which totaled 45 million in 2003. These plans would allow professional and trade associations to band together to use their heightened purchasing power to offer insurance coverage to their members. Because of these economies of scale, AHPs would reduce insurance costs for employers who purchase coverage for their employees, at least in theory.
A key problem with AHPs, however, is that they would likely be stripped-down plans — cheaper largely because they may exclude preventive care and other services and leave enrollees at greater risk. In particular, one of the biggest attractions for employers is that AHPs would be exempt from states’ mandated-benefit laws, several of which relate directly to reproductive health care. For example, since the 1970s, every state has had a law to ensure that newborns are covered from birth and that costly conditions discovered in the first few days of a baby’s life are not excluded from coverage, as had been the practice of insurers until that point.
In addition, some states require that policies cover newborn screening, pregnancy complications, cervical cancer screening, infertility treatment, and breast cancer diagnosis and treatment. Twenty-three states require plans to cover contraceptive drugs and devices if they cover prescription drugs in general. (To check your state’s law, visit the Alan Guttmacher Institute web site, www.guttmacher.org; click on "States" and "State Policies in Brief," then under "Prevention and Contraception," click on "Insurance Coverage of Contraceptives," to see a list of state information.) These laws are widely acknowledged as vital to the improvement in contraceptive coverage over the last decade.
Recognizing the importance of contraceptive coverage to women and their families, two members of Congress in March offered an amendment on the subject to the AHP legislation pending before a key committee of the House of Representatives. Specifically, the amendment proposed by Reps. Rush Holt (D-NJ) and Betty McCollum (D-MN) would have required AHPs that cover prescription drugs to provide the same level of coverage to prescription contraceptives. The amendment failed on a party line vote of 19-22.
The White House claims that AHPs, combined with health savings accounts and health care tax credits, will lead to "more than 11 million and as many as 17.5 million newly insured Americans." Yet an analysis by the nonpartisan Congressional Budget Office finds two likely results of AHPs.
First, employers with healthier work forces would be more likely than others to move into these plans, leaving the traditional market with a higher concentration of less healthy groups, who would end up paying higher premiums. Second, the analysis finds that almost all of the 4.6 million individuals likely to be covered under AHPs would be "transfers" from traditional coverage. These individuals are likely to have less comprehensive coverage than before, because they would not be covered by state mandated-benefit laws. The Congressional Budget Office estimates that AHPs would reduce the number of uninsured Americans by only 330,000 nationwide.
Whether the AHP legislation ultimately will become law remains an open question, although health care advocates, including advocates of reproductive health care, believe there is significant cause for concern. The House of Representatives passed virtually identical legislation in 2003 and is likely to do so again. The Senate, however, has never considered the legislation, so its fate there is less clear.
The sponsor of the Senate bill is Sen. Olympia Snowe (R-ME), who chairs the Committee on Small Business and Entrepreneurship; the Committee held a hearing in April that featured AHPs. Snowe also has been a longstanding champion of women’s access to reproductive health care, and, perhaps ironically, is also the author of the Equity in Prescription Insurance and Contraceptive Coverage Act (EPICC), a bill that would establish a national contraceptive coverage requirement in health plans that cover prescription drugs.
Strange bedfellows oppose the bill on the common ground that it would allow AHPs to operate without state oversight. This coalition includes many of the nation’s largest insurers; the U.S. Chamber of Commerce and the National Governors Association, both based in Washington, DC; medical professional organizations; and health care advocates. On the other side of the coin, the Nashville, TN-based National Federation of Independent Business has made passage of the AHP legislation its top priority; the Bush administration has thrown its weight behind the legislation as well. Only time will tell which side has the stronger hand.
The Bush administration and conservative members of Congress are touting legislation to create Association Health Plans (AHPs) as one of their answers to the growing problem of the nations uninsured, which totaled 45 million in 2003. These plans would allow professional and trade associations to band together to use their heightened purchasing power to offer insurance coverage to their members.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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