June 13th, 2008

Earlier this year, the state House amended and passed SB 1137, establishing the new health insurance plan PA ABC and linking it to the doctor’s MCARE fund, which helps pay for physicians’ liability insurance, reports the Central Penn Business Journal.

That plan has now been stalled in the Senate for months as medical groups, business, and government debates the merits of the plans components.  Many say that PA ABC was “more politically acceptable than the Cover ALL Pennsylvanians proposal that Gov. Ed Rendell introduced in early 2007″.  PA ABC aims to cover 272,000 uninsured Pennsylvanians in the next five years, would offer grants to small businesses that already pay for insurance for their employees, and would help doctor’s pay for their liability insurance coverage.

The plan will cost  $501 million for the first year and then $1.1 billion within five years.  Rosemary Greco, director of the Gov’s Office of Health Care Reform says that the plan will help businesses, because it will provide $42 million in grants for small businesses with two to 50 employees that have offered insurance of over the past year.

Although, entreprenur like Cookie Driscoll, say that the small-business grants, although excellent in theory, are sometimes not as great as they sound.  He explains, “I’m the only employee and I can’t afford to have any more employees because I can’t afford health insurance for them. It’s a vicious cycle.”

The PA Chamber of Business and Industry also has problems with the plan.   The Chamber has “concerns over the idea of state-supported coverage” and believes that lawmakers should first look at ways to lower the cost of insurance through enacting liability reform and allowing insurers to offer plans without expansive mandates. Gene Barr, vice president of legislative affairs stated that, “We’re simply reshuffling costs around (with ABC).”

Hesitations from the Pennsylvania Medical Society to support the plan revolve around parts of the MCARE component. President of the Pennsylvania Medical Society Dr. Peter Lund wants more people to have insurance, ”People who don’t have insurance are sicker and die quicker.”  However, his problem with the PA ABC plan is that it requires doctors who want to recieve the MCARE fund abatement to accept ABC participants at their facilities.  When doctors are forced to accept certain patients they are often not certain if they will get full reimbursement from the insurance companies.  He says, as doctors lose their leverage through the mandate, insurance compaines “can reimburse at any rate they want to.”

Earlier this week, the Senate Republicans came out with their own plan, HealthNET PA, which they believe addresses some of these concerns.  Greco states that  small business entreprenurs, like Driscoll, will make a big impact in whether SB 1137 makes it through the Senate or whether HealthNET PA gains more support.  “We need their help,” she said.  “We need them speaking with their legislators”