Delegates pass health bill benefiting uninsured

Plan has critics on 2 sides as it moves to Senate

General Assembly

April 03, 2004|By M. William Salganik | M. William Salganik,SUN STAFF

After spirited debate, the House of Delegates yesterday gave final approval to a bill that would extend health services to some of Maryland's uninsured.

The bill would provide partial coverage to some uninsured adults, but effectively shelve a more ambitious "health care for all" proposal that is to be deferred to a task force study after the session.

Del. John Adams Hurson, a Montgomery County Democrat who is the bill's sponsor and chairman of the House health committee, said the bill would provide "a very efficient approach to trying to get primary and preventive care to the uninsured."

As the plan moves to the Senate, it faces criticism from two ends of the political spectrum: those who seek a greater expansion of coverage for the needy and those who are concerned that even the limited plan costs too much for the state during a budget bind.

"We tried to steer a course where we're doing what we can without busting the bank," said Hurson, who portrayed his bill as an attempt to balance budget concerns with an effort to reduce the number of uninsured in the state. He urged his colleagues to take some action on health coverage this year.

"When I first got here, there were about 500,000 uninsured in Maryland, in 1991," Hurson said. "Today, it's more than 700,000."

The key to paying for the expansion would be a 1 percent tax on HMO premiums. While there is a 2 percent tax on other health insurance premiums, HMOs have been exempt.

"At least part of it will pass" in the Senate, predicted Sen. Paula C. Hollinger, a Baltimore County Democrat who chairs the Senate Education, Health and Environmental Affairs Committee. Hollinger said the Senate would probably have few problems with plans to aid community and school-based health clinics, which would be done largely with federal grants, but "expansion [of coverage] may have a more difficult time because of the whole fiscal situation."

Even if the Senate passes the bill, it seems unlikely to be signed into law by Gov. Robert L. Ehrlich Jr. He vetoed a 2 percent HMO tax last year.

"The governor is not inclined to support an HMO tax," Henry Fawell, a spokesman, said after the vote. "He believes it would be passed on to the consumer."

While the House's 86-54 vote in favor of the bill is one more than needed to overturn a gubernatorial veto, it doesn't give supporters of health expansion much margin if Ehrlich does veto and the administration pressures delegates to switch.

The HMO tax was the focus of debate on the House floor.

"The tax man looks like he's here again," House Minority Whip Anthony J. O'Donnell, a Southern Maryland Republican, said during floor debate. "And it looks like a large bill." The 1 percent HMO tax is expected to raise more than $40 million a year.

"The goal of the bill is laudable, but it should have been implemented in more affordable steps," said Del. Donald B. Elliott, a Republican who represents Carroll and Frederick counties.

Small business groups, in particular, have argued that the HMO tax would increase the cost of insurance and make it harder for employers to afford it.

"Solutions to addressing the uninsured cannot be rooted in a concept that makes people, who can barely pay now, pay more," said Ellen Valentino, state director for the National Federation of Independent Business.

Hurson argued on the House floor that HMOs are profitable enough and the market competitive enough, that insurers might absorb the tax rather than pass it along to consumers through higher premiums.

He also said the increased coverage would produce some savings, particularly in providing primary and preventive care that could keep the currently uninsured from seeking more expensive treatment in hospital emergency rooms. He estimated the savings in emergency room costs at $26 million.

"I'm voting for the bill because I want to have less business when this session ends, and I go back to my other job," said Del. Dan Morhaim, a Baltimore County Democrat who is an emergency room physician.

Only one Republican in the House, Del. Robert A. Costa of Anne Arundel County, voted for the bill. A dozen Democrats, from rural counties and conservative eastern Baltimore County, joined the Republicans in voting no.

Any expansion of health coverage is unusual these days. Most states, caught between escalating health costs and stretched state budgets, have limited eligibility, trimmed benefits or cut back on payments to doctors and hospitals.

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