Panel votes curbs on medical costs

March 04, 1993|By John W. Frece | John W. Frece,Staff Writer

A House committee, determined to put cost-containment teeth in its health insurance reform bill, voted yesterday to impose caps on how much doctors in Maryland may charge for their services and to slap controls on insurance company profits.

The limits on fees by physicians and other health care providers would not go into effect until 1996. The delay is designed to give a proposed new Medical Care Data Commission time to collect and analyze information about physician charges, procedures and practices and to develop a fee schedule as part of a report to the governor and General Assembly due by Oct. 1, 1995.

The constraints on insurance company profits would take effect in 1994. The bill would require that at least 70 cents of every premium dollar charged by commercial health insurers be spent on policyholder claims and that not more than 15 cents be spent on staff or other administrative expenses.

"If we do this, we may be the first state to try to control health industry profits," said Del. John A. Hurson, a Montgomery County Democrat who helped draft the two provisions for the Economic Matters Committee.

The proposals were late additions to a health insurance reform bill, House Bill 1359, which the committee approved 25-1 Tuesday. Debate on the bill by the full House should begin today.

The bill is designed to make health insurance more available to all Marylanders, but especially to those in small businesses, and to stabilize insurance costs by spreading the risk among as large a community of policyholders as possible.

The bill also would set up the seven-member data commission to develop a standard benefits plan that all health insurers would be required to offer, and to begin collecting cost data on all nonhospital health care services.

Doctors have long opposed the idea of fee schedules, and as recently as Tuesday testified in force against fee schedule proposals before the Senate Finance Committee.

"Fees are not known to be a problem in Maryland," Dr. Joseph Fastow, an emergency room physician at Calvert Memorial Hospital and chairman of the medical society's executive committee, told the Finance Committee Tuesday.

But Angelo Troisi, executive director of the Medical and Chirurgical Faculty of Maryland, the state medical society, said there were other provisions within House Bill 1359 that doctors supported.

He specifically praised the bill's efforts to make insurance available for the estimated 570,000 Marylanders who are currently uninsured, and a provision that would phase out the practice of withholding coverage to new policyholders for up to a year because the policyholder has cancer, diabetes or some other "pre-existing" medical condition.

Bryson F. Popham, a lobbyist representing a coalition of insurance brokers and agents, praised the committee chairman, Casper R. Taylor Jr., an Allegany Democrat, for "obviously doing his best to get everyone in the boat. I think the committee has done an admirable job."

MedChi's Mr. Troisi predicted the new commission would find the task of developing a fee schedule is so massive that it cannot be accomplished in only two years.

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