Government Health Plans, Costs For Uninsured Called 'Hidden Tax'

Health Coverage Hearings Continue

The Charleston Gazette, February 10, 2006

Families covered by private-sector health insurance will pay an average of more than $15,000 in 2007 — with nearly $3,000 of that going to pick up the expenses of uninsured or underinsured patients, Mountain State Blue Cross/Blue Shield President Greg Smith said Thursday.

Smith told the House Health and Human Resources Committee that those costs include not only the uninsured, but also government health plans — including the Public Employees Insurance Agency, Medicaid and Medicare — that pay “considerably less than the cost for providing these services.”

“You cannot continue to put pressure on the private sector to make up the difference,” Smith told the committee. “It’s the greatest hidden tax in the state. Every time you underfund a public [health insurance] program, you’re raising costs on the private sector.”

In the second of a series of hearings on a Manchin administration bill (HB4021) to extend some health coverage to some of the 245,000 uninsured West Virginians, Smith and West Virginia Hospital Association CEO Steven Summer both told the panel the system can no longer sustain the cost-shift for the uninsured and government payers.

Smith said he supports Manchin’s plan to offer limited health care coverage for as little as $99 a month. “I think people will be surprised at what will be covered for $99 a month,” he said. He said every worker in the state should pay for some level of health insurance coverage, just as lawmakers 28 years ago mandated that every state driver must have auto insurance.

Smith said there also needs to be fundamental changes in the way the health care industry operates, noting that it is the only industry where competition actually increases product costs. “We do not shop for price in health care — we shop for service,” he said. “None of us has a clue when we enter that hospital what the cost will be.”

While costs can vary considerably from hospital to hospital for the same medical procedures, consumers currently have no incentive to price-shop, he said.

Summer, meanwhile, told the committee the hospital association supports Gov. Joe Manchin’s proposals to “incrementally expand coverage for the uninsured” — but said those proposals are only part of a very complex puzzle.

“Clearly, our current health care financing and delivery system is unsustainable, and improvements in the system are essential to maintain access, assure quality and patient safety, and control the rate of increase of health care costs,” he said.

The House committee is holding a series of hearings with health care experts, followed by a public hearing, to determine whether to move forward with the governor’s proposals, or to incorporate those plans into a more ambitious effort to provide health coverage to all West Virginians by 2010.