Utah is drawing a line in the sand on managed health care.
Recently, the Legislature narrowly defeated a bill that would have mandated coverage of mental health in managed-care plans. The bill would have put too great a burden on health-care providers, opponents argued, forcing them to raise prices.
But in Utah and in statehouses across the country, the battle to define what managed-care plans should and shouldn't cover is just heating up. Increasingly, lawmakers are pushing managed-health providers like health-maintenance organizations (HMOs) to include a wider range of people and ailments in their coverage. But the providers counter that this push will nudge their bottom line upward, making care less affordable. As legislators reach their decisions during the coming year, the future of the managed-care system hangs in the balance.
"The trend is toward legislator-designed health plans," says Larry Bunkall, president of the Utah Manufacturers Association. Indeed, Utah is at the forefront of the movement, with lawmakers here considering 15 bills that would mandate coverage of everything from dermatology to depression.
And Utah's not alone. The Health Insurance Association of America estimates that a hodgepodge of as many as 13,000 benefit requirements have been put in place around the nation - and more are coming.
The managed-care conundrum
Managed-care programs were created to stem double-digit premium increases while offering quality health care, but they have come under increasing fire for sacrificing quality and choice to keep costs down. Recently, President Clinton made his patient "bill of rights" a key part of his State of the Union address, and a current federal proposal, the Patient Access to Responsible Care Act (PARCA), would allow patients to claim for injury or death resulting from the denial of treatment.
Nationally, big businesses that self-insure are having to deal with this rising tide of federal legislation like PARCA. On the state level, small businesses are worried by the mounting costs that come along with state mandates.
How much the mandates will cost, however, is a subject of wide disagreement. State Rep. Brian Allen, who sponsored the mental-health bill, said that adding mental-health coverage would raise premiums only 2.7 percent. But the Washington-based National Center for Policy Analysis says mental-health coverage adds between 5 percent and 10 percent to premiums. The center also looked at the 12 most common mandates and concluded that, collectively, they can increase the cost of insurance by as much as 30 percent. "Our concern is that each mandate comes with a cost," says Mr. Bunkall.
Mandates and the health-care system
Rep. John Valentine, Utah's assistant majority whip, worries that the wave of mandates will destroy the health-care system. "They all have very good social-policy goals," he says. "But to try to absorb them all into the insurance system has a tendency to collapse the system."
Actually, states have mandated health-care coverage for 30 years, but many, including Utah, are especially active now because premiums have stabilized. And with consumers grousing more about a lack of choice for doctors or health-care providers than rising premiums, many feel the time is right for change.
"We don't want mandates, but health-insurance plans are hurting small constituencies that don't have enough clout to change the system," says Representative Allen. "We're being forced into the position of having mandates."
Others add that the health-care industry just needs a push toward compassion. "Insurance companies are moving toward that with courage," says state Rep. Sheryl Allen. "But they've moved at a pace slower than a baby's first step."