'No-frills' Insurance Is Getting Attention In Annapolis

AS I SEE IT

March 10, 1991|By Sharon Hornberger

As I see it, "no frills" health insurance is gaining ground.

Of the nearly 600,000 people in Maryland who have no health insurance, more than 50 percent are employed. They are either self-employed or work for businesses too small to afford group coverage.

Half of the employed uninsured earn more than $20,000 and 20 percent earn more than $40,000 annually.

In Carroll County, 13,000 people, or 11.7 percent of the population, carry no health insurance.

Of Maryland's 40,722 small businesses, employing one to 25 people, 43 percent offer no health insurance coverage to their employees. A little more than 3 percent of those businesses are in Carroll County.

When people have no health insurance, they usually postpone preventive medical care to the point where vague symptoms become illness andillness becomes chronic or irreversible disease. If these people become medically indigent because they have lost their jobs and exhausted their assets in paying medical bills, we taxpayers will pick up theMedicaid bill for their treatment.

"No frills" insurance legislation, which the General Assembly is considering, gives small businesses the option of offering limited health coverage to their employees. The legislation has the backing of both business and labor.

Specifically, the bill would allow businesses, employing 20 to 25 people, which had not offered a health insurance plan during the past year, tooffer a stripped-down version of basic health insurance to their workers.

The measure also would allow individuals who had not carriedinsurance during the past year to buy the policy.

The coverage would be offered only for three-year duration. It is hoped that the worker or individual would be able to afford more extensive coverage after that time.

The plan would limit physician outpatient visits to 10 a year and exclude coverage to most expensive mandated benefits, such as substance abuse and mental health treatment. The policy would cost about half of what the average group policy costs.

The Governor's Commission of Health Care Policy and Financing points to Maryland's 30 mandated benefits as a major reason why small businesses oftencan't afford to offer employees health insurance.

The state has the second highest number of mandated benefits in the nation. They range from in vitro fertilization to organ transplants to treatment for mental illness and drug and alcohol abuse.

Blue Cross notes that mandated benefits accounted for 21 percent of its provider payments in1987. By 1996, Blue Cross predicts that reimbursement payments for mandated benefits will climb to 40 percent of all payouts.

It should be noted that big corporations and businesses can get around offering mandated benefits by becoming self-insured. This is an option thatmost businesses are not large enough to take advantage of.

While mandated benefits do drive up the cost of health insurance, they are only one factor. In general, the cost of health care continues to soar, outpacing all other consumer items.

U.S. spending on health care rose 11 percent, to a record $604 million, in 1989. In the same year, the gross national product grew 6.7 percent.

In the Baltimore metropolitan area, which includes Carroll, spending for medical care rose 9 percent, almost twice the 4.8 percent increase in the Consumer Price Index.

The governor's health-care commission has recommendeda basic health benefit policy that puts no limits on doctor's officevisits and offers at least seven days of mental health outpatient visits, prenatal and postnatal maternity care and mammograms for women age 50 and older.

The plan, similar to one adopted in Massachusetts, requires businesses with two to 50 employees that have not offeredhealth insurance in the previous 12 months to offer all full-time and some part-time workers health care coverage. Alternately, the company can pay a fee into a special fund used to spread the risk of catastrophic health care costs.

The policy would offer coverage to the employee, not his family.

Frankly, I would be surprised if the General Assembly ever approved such a plan. It is not the responsibilityof private enterprise to guarantee health-care coverage to the uninsured.

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