Health Reform Beats Lawmakers’ Pace Most Residents Already Covered Under Managed Care Plans

MONDAY, FEB. 27, 1995

While state lawmakers toil over health care reform, the marketplace already has revolutionized the way most people get and pay for medical care.

Seventy-five percent of Washington residents with health insurance provided through their employer are covered under some kind of managed care plan, according to a study released in December by the state budget office.

The state already has more residents in managed care plans than most other states, the study found.

Under managed care, insurance companies play a role in deciding which health care providers patients see, the fees they pay, and the care they get.

Fewer patients receive care under traditional fee-for-service plans, in which patients see the doctor of their choice and pay whatever fee the doctor sets.

Doctors know they can’t turn back the clock, said Peter McGough, president of the State Medical Association, and a family practice physician in West Seattle.

“MD used to stand for Medical Deity, in which doctors tell their patients what to do and bill insurance companies without any explanation or accountability,” McGough said. “That’s history.”

But the managed care revolution has gone too far, he said.

“We have people with no understanding of medicine setting the guidelines for care. The private marketplace has already interfered with the traditional practice of medicine to a far greater extent than government.”

Lawmakers are wrestling with assuring quality of care, patient choice, and controlling health care costs as they mull health care reform bills in Olympia.

The bills range from tinkering with the 1993 health care reform act to a near total repeal of the measure.

The act has to be re-worked because it can’t go into effect without federal waivers, which aren’t likely to be granted.

McGough and others are urging lawmakers to regulate the managed care revolution as they re-visit health reform.

“What we increasingly have is corporate and insurance-run medicine. There is as much risk there as in so-called governmentrun medicine,” said Don Brennan, a member of the state Health Services Commission, which was created to implement the 1993 law.

“Look at what’s happening in the practice of medicine today. You have fee schedules set by insurance companies that sign up the doctors they choose to do business with.

“They put increasingly onerous controls on the practice, which both doctors and patients hate. We somehow have to create a different climate.”

Insurers say the criticisms of managed care are exaggerated. They call government regulations proposed by Senate Democrats in SB 5935, which re-writes the 1993 act, onerous overkill.

The marketplace provides the best consumer protection, some insurers argue, because it forces insurers to provide care people want at a price they can pay.

They say government regulation would drive insurance companies out of business, or force customers to buy more insurance than they really need because of a mandated minimum benefits set by bureaucrats.

“These misguided proposals ultimately are not in consumers’ best interest,” said Melvin Sorensen, a lobbyist for insurance companies, including Medical Service Corp. in Spokane.

Managed care allows insurers to sell a wide range of products to suit every budget, said Basil Badley, lobbyist for the Health Insurance Association of America. That group created the Harry and Louise television ads that torpedoed President Bill Clinton’s health reform plans.

“Managed care enables us to stay in the market,” Badley said. “Otherwise we can issue policies to Bill Gates and the Kennedy family, but no one else can afford our products.”

Sen. John Moyer, R-Spokane, ranking minority member of the Senate Health and Long-Term Care Committee said he fears a “medical industrial complex” is transforming the traditional practice of medicine.

“Cost has triumphed in the decision-making, and that’s our fault,” Moyer said, speaking of doctors. “Care became too high-priced. But what we need now is some balance between that concern about cost and concern about quality of care.”

Striking that balance is what most of the fight over health care reform will be about, Moyer and others said.

“The docs have a point,” Badley said. “But it’s going to take some time before we get the right line in the sand between total discretion and putting some reins on this thing.”

xxxx BILLS AT A GLANCE Two major health care reform bills are before the Legislature:

HB1046: Repeals most of the 1993 health care reform act, including a cap on insurance rates, the requirement that employers provide insurance and the minimum benefits package. Keeps insurance reforms, which ban exclusions for preexisting conditions and allow people to keep insurance when they change jobs. Expands Basic Health Plan for uninsured and allows medical savings accounts. Goes directly to the ballot if approved.

SB5935: Keeps cap on insurance rates, minimum benefits package, insurance reforms. Eliminates employer mandate. Offers incentives for employers to cover workers. Authorizes medical savings accounts.


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